HB 1461 — An Act amending the act of March 10, 1949 (P.L.30, No.14), known as the Public School Code of 1949, providing for the Career and Technical Education Investment Incentive Program.

PRINTER'S NO.   1721

                     THE GENERAL ASSEMBLY OF PENNSYLVANIA



                         HOUSE BILL
                         No. 1461
                                                 Session of
                                                   2025

     INTRODUCED BY ANDERSON, HAMM, RAPP, ROWE, PUGH, STAATS,
        SCHEUREN, COOPER AND M. MACKENZIE, MAY 14, 2025

     REFERRED TO COMMITTEE ON FINANCE, MAY 14, 2025


                                       AN ACT
 1   Amending the act of March 10, 1949 (P.L.30, No.14), entitled "An
 2      act relating to the public school system, including certain
 3      provisions applicable as well to private and parochial
 4      schools; amending, revising, consolidating and changing the
 5      laws relating thereto," providing for the Career and
 6      Technical Education Investment Incentive Program.
 7      The General Assembly of the Commonwealth of Pennsylvania
 8   hereby enacts as follows:
 9      Section 1.     The act of March 10, 1949 (P.L.30, No.14), known
10   as the Public School Code of 1949, is amended by adding an
11   article to read:
12                                ARTICLE XX-N
13                       CAREER AND TECHNICAL EDUCATION
14                        INVESTMENT INCENTIVE PROGRAM
15   Section 2001-N.    Scope of article.
16      This article relates to the Career and Technical Education
17   Investment Incentive Program.
18   Section 2002-N.    Definitions.
19      The following words and phrases when used in this article
20   shall have the meanings given to them in this section unless the
 1   context clearly indicates otherwise:
 2      "Applicable tax."   The liability for taxes imposed under
 3   Articles III, IV, VI, VII, VIII, IX, XV or XX of the Tax Reform
 4   Code of 1971 or a tax under Article XVI of the act of May 17,
 5   1921 (P.L.682, No.284), known as The Insurance Company Law of
 6   1921. The term shall not include a tax withheld by an employer
 7   from an employee under Article III of the Tax Reform Code of
 8   1971.
 9      "Area career and technical education school."     A specialized
10   public secondary school established under subdivision (c) of
11   Article XVIII which is used exclusively or principally for the
12   provision of career and technical education programs to
13   individuals preparing to enter the labor market or pursue
14   postsecondary education.
15      "Business firm."    An entity authorized to do business in this
16   Commonwealth and subject to taxes imposed under Article III, IV,
17   VI, VII, VIII, IX, XV or XX of the Tax Reform Code of 1971 or a
18   tax under Article XVI of The Insurance Company Law of 1921. The
19   term includes a pass-through entity, including a pass-through
20   entity whose purpose is the making of contributions under this
21   article and whose shareholders, partners or members are composed
22   of owners or employees of other business firms.
23      "Career and technical education partnership organization."     A
24   nonprofit entity which meets all of the following:
25           (1)   Is exempt from Federal taxation under 26 U.S.C. §
26      501(c)(3) (relating to exemption from tax on corporations,
27      certain trusts, etc.).
28           (2)   Provides support or expands access to career and
29      technical education programs.
30           (3)   Contributes based on one of the following:

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 1                (i)    At least 80% of its annual cash receipts as
 2          contributions to a participating school for program-
 3          related costs. For purposes of this subparagraph, a
 4          nonprofit entity "contributes" its annual cash receipts
 5          when it expends or otherwise irrevocably encumbers those
 6          funds for expenditure during the then-current fiscal year
 7          of the nonprofit entity or during the next succeeding
 8          fiscal year of the nonprofit entity. A nonprofit entity
 9          shall also include a school district foundation, public
10          school foundation, charter school foundation or area
11          career and technical education school foundation.
12                (ii)    At least 80% of its annual cash receipts to an
13          enrollment expansion program. For purposes of this
14          subparagraph, a nonprofit entity "contributes" its annual
15          cash receipts to an enrollment expansion program when it
16          expends or otherwise irrevocably encumbers those funds
17          for distribution during the then-current fiscal year of
18          the nonprofit entity or during the next succeeding fiscal
19          year of the nonprofit entity.
20                (iii)    At least 80% of its annual cash receipts to a
21          combination of expenditures under subparagraphs (i) and
22          (ii).
23      "Career and technical education program."     Any of the
24   following:
25          (1)   A vocational education program approved by the
26      Department of Education under 22 Pa. Code Ch. 339 (relating
27      to vocational education).
28          (2)   A program that provides educational activities which
29      meet all of the following:
30                (i)    Offer a sequence of courses that:

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 1                       (A)   Provide individuals with content aligned
 2                with academic standards and technical knowledge and
 3                skills needed to prepare for further education and
 4                careers in a high-priority occupation.
 5                       (B)   Provide technical skill proficiency, an
 6                industry-recognized credential or a certificate.
 7                (ii)    Include competency-based applied learning that
 8          contributes to the academic knowledge, higher-order
 9          reasoning and problem-solving skills, work attitudes,
10          general employability skills, technical skills,
11          occupation-specific skills and knowledge of all aspects
12          of an industry, including entrepreneurship, of an
13          individual.
14      "Charter school."       As defined in section 1703-A.
15      "Contribution."        The donation of any of the following:
16          (1)   Cash to a career and technical education partnership
17      organization to be used to pay program-related costs.
18          (2)   Cash to a career and technical education partnership
19      organization to be used for an enrollment expansion program.
20          (3)   Personal property, including equipment and supplies,
21      as approved by the participating school.
22          (4)   Services, the value of which is the net cost of the
23      donation to the donor or the pro rata hourly wage, including
24      benefits, of the individual performing the service, as
25      approved by the participating school.
26      "Cyber charter school."        As defined in section 1703-A.
27      "Department."      The Department of Community and Economic
28   Development of the Commonwealth.
29      "Eligible student."       An individual who:
30          (1)   Is of school age, as defined in section 2002-B.

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 1          (2)   Is enrolled in a school entity.
 2          (3)   Intends to enroll in an age-appropriate career and
 3      technical education program.
 4          (4)   Is a current resident of this Commonwealth.
 5      "Enrollment expansion program."      A program established to pay
 6   the costs associated with increasing the enrollment of eligible
 7   students in a career and technical education program at
 8   participating schools.
 9      "High-priority occupation."     A profession that:
10          (1)   is high-wage and high-skill for which there is
11      excess employer demand as identified in the Department of
12      Labor and Industry's current year's high-priority or in-
13      demand occupations list or the State System of Higher
14      Education's workforce needs assessment; or
15          (2)   requires a credential, certification, licensing,
16      postsecondary training, associate's degree, bachelor's
17      degree, master's degree or doctoral or first professional
18      degree.
19      "Participating school."     A public school, area career and
20   technical education school, charter school or regional charter
21   school that chooses to participate in the program.
22      "Pass-through entity."     A partnership as defined in section
23   301(n.0) of the Tax Reform Code of 1971, a single-member limited
24   liability company treated as a disregarded entity for Federal
25   income tax purposes or a Pennsylvania S corporation as defined
26   in section 301(n.1) of the Tax Reform Code of 1971. The term
27   includes a pass-through entity that owns an interest in a pass-
28   through entity.
29      "Program."     The Career and Technical Education Investment
30   Incentive Program established under this article.

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 1      "Program-related costs."     Cost and fees for rental or
 2   purchase of equipment, materials or supplies used in instructing
 3   a career and technical education program at a participating
 4   school.
 5      "Public school."     A public elementary school or a public
 6   secondary school at which a resident of this Commonwealth may
 7   legally fulfill the compulsory school attendance requirements of
 8   this act and which meets the applicable requirements of 42
 9   U.S.C. Ch. 21 Subch. VI (relating to equal employment
10   opportunities).
11      "Regional charter school."     As defined in section 1703-A.
12      "School entity."     A public school, area career and technical
13   education school, charter school, regional charter school or
14   cyber charter school.
15      "Secondary school."     A school with an eleventh grade.
16      "Tax Reform Code of 1971."     The act of March 4, 1971 (P.L.6,
17   No.2), known as the Tax Reform Code of 1971.
18   Section 2003-N.   Declaration of policy.
19      The Commonwealth recognizes that businesses need educated and
20   trained workers. It is the intent of the General Assembly to
21   foster and encourage private investment in career and technical
22   education programs and the repair, upkeep, replacement and
23   upgrading of industry-grade materials and instructional
24   equipment. Furthermore, it is the intent of the General Assembly
25   that private investment will open doors of opportunity for
26   students and enable them to develop the knowledge and skills for
27   high-demand careers under this article.
28   Section 2004-N.   School participation in program.
29      (a)    Election to participate.--By October 1, 2025, and each
30   January 1 thereafter, a school entity other than a cyber charter

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 1   school may elect to participate in the program under this
 2   article for the following school year.
 3      (b)   Notice.--A school entity that elects to participate
 4   under subsection (a) shall notify the department of the intent
 5   to participate on a form developed by the department. The notice
 6   under this subsection shall specify all of the following:
 7            (1)   That the school entity intends to be a participating
 8      school.
 9            (2)   The amount of program-related costs attributable to
10      each eligible student. The amount under this paragraph shall
11      not exceed the amount that would have been attributed to a
12      student outside of the enrollment expansion program.
13      (c)   Participating school responsibilities.--The following
14   responsibilities shall apply to a participating school:
15            (1)   Prior to enrollment of a student, a participating
16      school shall inform the parent of a student of the rules,
17      policies and procedures of the participating school,
18      including any academic policies, disciplinary rules or
19      administrative procedures. Enrollment of a student in a
20      participating school shall constitute acceptance of any
21      rules, policies or procedures of the participating school.
22            (2)   A participating school may enroll an eligible
23      student in a career and technical education program until the
24      participating school's available seats are filled.
25   Section 2005-N.     Establishment and qualification by
26                  organizations.
27      (a)   Qualification.--
28            (1)   In order to qualify for contributions under this
29      article, a career and technical education partnership
30      organization must certify to the department that the

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 1    organization is eligible to participate in the program.
 2        (2)   A career and technical education partnership
 3    organization must agree to annually report by October 1,
 4    2025, and each September 1 thereafter, on a form provided by
 5    the department, the following information:
 6              (i)    The organization is exempt from taxation under
 7        26 U.S.C. § 501(c)(3) (relating to exemption from tax on
 8        corporations, certain trusts, etc.).
 9              (ii)    The total number of eligible students and the
10        total amount of contributions awarded per participating
11        school during the immediately preceding school year
12        through an enrollment expansion program.
13              (iii)    Where the career and technical education
14        partnership organization collects information on a
15        county-by-county basis, the total number of eligible
16        students and the total amount of contributions awarded
17        during the immediately preceding school year through an
18        enrollment expansion program to residents of each county.
19              (iv)    The names and descriptions of career and
20        technical education programs and the total amount of the
21        contributions made to those programs during the
22        immediately preceding school year.
23              (v)    The name of each participating school that works
24        with businesses that offer internships, apprenticeships
25        and mentoring programs.
26              (vi)    The name of each participating school where
27        career and technical education programs that received
28        contributions were implemented as a result of the
29        contribution during the immediately preceding school
30        year.

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 1              (vii)    Where the career and technical education
 2        partnership organization collects information on a
 3        county-by-county basis, the total number and the total
 4        amount of contributions made during the immediately
 5        preceding school year for career and technical education
 6        programs at participating schools in each county in which
 7        the contributions were made.
 8              (viii)    The number of credentials earned, including,
 9        but not limited to, a certificate, industry certification
10        or State license, and the industry or occupation to which
11        the credential is linked to this program during the
12        immediately preceding school year.
13              (ix)    The number of students employed in high-
14        priority occupations as a result of participating in the
15        program.
16              (x)    The number of students who secured internships
17        or apprenticeships for high-priority occupations.
18              (xi)    The organization's Federal Form 990 or other
19        Federal or State form indicating the tax status of the
20        organization for Federal and State tax purposes, if any,
21        and a copy of a compilation, review or audit of the
22        organization's financial statements conducted by a
23        certified public accounting firm, including an itemized
24        list of expenditures.
25        (3)   A career and technical education partnership
26    organization shall provide information under paragraph (2) to
27    the best of the career and technical education partnership
28    organization's ability.
29        (4)   The department shall provide forms to interested
30    career and technical education partnership organizations and

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 1      shall post the forms on its publicly accessible Internet
 2      website.
 3            (5)   The department may not require any other information
 4      to be provided by career and technical education partnership
 5      organizations, except as expressly authorized under this
 6      article.
 7            (6)   A career and technical education partnership
 8      organization that does not meet the certification
 9      requirements of this article shall not be eligible to
10      participate in the program.
11      (b)   Publication.--The department shall post and update as
12   necessary a list of each career and technical education
13   partnership organization qualified under this section on the
14   department's publicly accessible Internet website.
15   Section 2006-N.    Contributions.
16      (a)   Designation of contribution.--A contribution made by a
17   business firm under this article shall be designated for:
18            (1)   an enrollment expansion program; or
19            (2)   program-related costs in a career and technical
20      education program.
21      (b)   Use of cash contributions.--A participating school shall
22   keep all cash contributions received under this article in a
23   restricted account which shall only be used for program-related
24   costs and enrollment expansion programs.
25   Section 2007-N.    Tax credit.
26      (a)   Application.--A business firm may apply to the
27   department for a tax credit certificate for contributions made
28   to a career and technical education partnership organization
29   under section 2006-N. A business firm that receives a tax credit
30   under this article shall be subject to the limitations in this

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 1   section and section 2008-N.
 2      (b)   Time of application for credits.--
 3            (1)   Except as provided under paragraph (2), the
 4      department may accept applications for tax credits available
 5      during fiscal year 2023-2024 no earlier than January 1, 2025,
 6      and for tax credits available each fiscal year thereafter no
 7      earlier than July 1.
 8            (2)   The application of a business firm for tax credits
 9      available during a fiscal year as part of the second year of
10      a two-year commitment or as a renewal of a two-year
11      commitment which was fulfilled in the previous fiscal year
12      may be accepted no earlier than May 15 preceding the fiscal
13      year.
14      (c)   Tax credit.--The Department of Revenue shall on a first-
15   come, first-served basis grant a tax credit against an
16   applicable tax to a business firm providing proof of a
17   contribution to a career and technical education partnership
18   organization in the taxable year in which the contribution is
19   made in accordance with the following:
20            (1)   The tax credit shall not exceed 75% of the total
21      amount contributed during the taxable year by the business
22      firm.
23            (2)   Except as provided under subsection (h), the tax
24      credit may not exceed $750,000 annually per business firm for
25      contributions made to career and technical partnership
26      organizations.
27      (d)   Priority.--Priority for a tax credit certificate under
28   subsection (c) shall be given to:
29            (1)   A business firm that did not receive a tax credit
30      under Article XX-B in the prior fiscal year.

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 1            (2)   A business firm that makes a contribution to a
 2      career and technical education partnership organization
 3      located in the business firm's workforce development area as
 4      described in the Workforce Innovation and Opportunity Act
 5      (Public Law 113-128, 128 Stat. 1425).
 6      (e)   Additional amount.--Subject to the limitations of
 7   section 2008-N, and in accordance with this section, the
 8   department shall grant a tax credit certificate of up to 90% of
 9   the total amount contributed during the taxable year if the
10   business firm demonstrates a written commitment to provide the
11   career and technical education partnership organization with the
12   same amount for at least two consecutive tax years at the time
13   of application.
14      (f)   Approval of tax credits.--Unless all authorized tax
15   credits have already been awarded, the department shall give
16   written notice of its approval to each business firm that
17   submits a completed application within 30 days following the
18   date postmarked on the envelope of the completed application.
19      (g)   Waiting list.--The department shall maintain a waiting
20   list of each business firm whose application has not been
21   approved because all available tax credits have been awarded,
22   and shall notify a business firm that is not awarded a tax
23   credit due to a lack of available tax credits that the business
24   firm is placed on the waiting list. When a tax credit becomes
25   available, the department shall award the tax credit to the
26   business firms in the order in which the business firms were
27   placed on the waiting list.
28      (h)   Temporary increase in maximum tax credits available.--
29            (1)   If all tax credits authorized under this section for
30      contributions to career and technical education partnership

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 1      organizations have not been awarded as of October 1 of a
 2      fiscal year, the limitations specified in subsection (c)
 3      shall not apply. The following shall apply:
 4                   (i)    The department may accept applications from
 5            October 1 through November 30 from a business firm,
 6            including a business firm that already applied for the
 7            maximum tax credits available under subsections (a) and
 8            (e).
 9                   (ii)    Tax credits awarded under this subsection shall
10            not exceed 75% of the total amount contributed during the
11            taxable year by a business firm pursuant to an
12            application filed under this subsection.
13                   (iii)    The provisions of subsection (b) shall not
14            apply to applications for tax credits made under this
15            subsection.
16            (2)    The tax credits awarded under this subsection shall
17      be awarded on a first-come, first-served basis.
18      (i)   Timing of contribution.--A contribution by a business
19   firm to a career and technical education partnership
20   organization shall be made no later than 30 days following the
21   approval of an application under subsection (a).
22   Section 2008-N.         Limitations.
23      (a)   Amount.--
24            (1)    The total aggregate amount of all tax credits
25      approved for contributions from business firms to career and
26      technical education partnership organizations may not exceed
27      $15,000,000 in a fiscal year.
28            (2)    No more than 10% of the total aggregate amount of
29      tax credits under this subsection shall be distributed to a
30      business making a contribution to be used for an enrollment

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 1      expansion program.
 2            (3)   No less than 90% of the total aggregate amount of
 3      tax credits under this subsection shall be distributed to a
 4      business making a contribution to pay program-related costs
 5      and for services and personal property contributions.
 6      (b)   Activities.--The department may not approve a tax credit
 7   for activities that are a part of a business firm's normal
 8   course of business.
 9      (c)   Tax liability.--
10            (1)   Except as provided under paragraph (2), a tax credit
11      granted for a taxable year may not exceed the tax liability
12      of a business firm.
13            (2)   In the case of a credit granted to a pass-through
14      entity which elects to distribute the tax credit under this
15      article, a tax credit granted for a taxable year and
16      distributed to a shareholder, member or partner may not
17      exceed the tax liability of the shareholder, member or
18      partner.
19      (d)   Use.--A tax credit not used by the applicant in the
20   taxable year the contribution was made or in the year designated
21   by the shareholder, member or partner to whom the credit was
22   transferred under this article may not be carried forward or
23   carried back and is not refundable or transferable.
24   Section 2009-N.    Notice of participating schools.
25      By November l, 2023, and each February 1 thereafter, the
26   department shall provide all career and technical education
27   partnership organizations with a list of each participating
28   school in this Commonwealth located within each county.
29   Section 2010-N.    Guidelines.
30      Within 45 days of the effective date of this section, in

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 1   consultation with the Department of Education, Department of
 2   Revenue and the Department of Labor and Industry, the department
 3   shall develop guidelines to implement the program.
 4   Section 2011-N.        Annual report to General Assembly.
 5      (a)   Submittal.--
 6            (1)   No later than December 1, 2026, and each December 1
 7      thereafter, the Secretary of Community and Economic
 8      Development shall submit a report to the General Assembly
 9      summarizing the impact of the program provided under this
10      article. The department shall post the report on its publicly
11      accessible Internet website.
12            (2)   The report shall be submitted to all of the
13      following:
14                  (i)    The chairperson and minority chairperson of the
15            Appropriations Committee of the Senate.
16                  (ii)    The chairperson and minority chairperson of the
17            Appropriations Committee of the House of Representatives.
18                  (iii)    The chairperson and minority chairperson of
19            the Education Committee of the Senate.
20                  (iv)    The chairperson and minority chairperson of the
21            Education Committee of the House of Representatives.
22      (b)   Contents.--The report shall include the following
23   information:
24            (1)   The amount of tax credits claimed for contributions
25      to a career and technical education partnership organization
26      during the fiscal year.
27            (2)   The total cash, personal property and service
28      contributions made from business firms to career and
29      technical education partnership organizations.
30            (3)   A list of all career and technical education

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 1      partnership organizations receiving contributions from a
 2      business firm granted a tax credit under this article.
 3            (4)   The number of high-priority industries participating
 4      in the program.
 5            (5)   The regional disbursement of tax credits.
 6            (6)   Other data points deemed relevant or necessary by
 7      the department administering the program.
 8      (c)     Provision of information.--The department shall provide
 9   information under subsection (b) to the best of the department's
10   ability.
11      Section 2.     Within 10 days of the development of the
12   guidelines under section 2010-N of the act, the Department of
13   Community and Economic Development shall transmit notice of the
14   development of the guidelines to the Legislative Reference
15   Bureau for publication in the next available issue of the
16   Pennsylvania Bulletin.
17      Section 3.     The addition of Article XX-N of the act shall
18   apply to taxable years commencing after December 31, 2025.
19      Section 4.     This act shall take effect as follows:
20            (1)   The following shall take effect immediately:
21                  The addition of sections 2001-N, 2002-N and 2010-N of
22            the act.
23                  Section 2 of this act.
24                  Section 3 of this act.
25                  This section.
26            (2)   The remainder of this act shall take effect
27      immediately upon publication in the Pennsylvania Bulletin of
28      the notice under section 2 of this act.




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