ARTICLE 308: LOCAL ECONOMIC REVITALIZATION TAX ASSISTANCE (LERTA) PROGRAM
The City of Chester has adopted a provision under the Local Economic Revitalization Tax Assistance Act (LERTA) to encourage the revitalization of deteriorated properties in portions of the City of Chester. Under the LERTA program, a company interested in expanding or constructing a new facility can defer the increase in real estate taxes on the value of the construction over a period of ten years. During the first year, the real estate tax attributable to the increased assessment due to the actual costs of improvements is 100 percent exempt. In subsequent years, the additional real estate taxes are phased in at a rate of 10 percent per year until the full assessment is reached in year ten.
Cross References
State law provisions - see 72 P.s. §4722 et seq.
Exemptions for dwelling improvements - see BUS. REG. & TAX. Art. 307
Building permit returns - see BLDG. Art. 1721
Commercial structures - see BLDG. Art. 1729
308.01 DEFINITIONS.
As used in this article, the following words and phrases shall have the meanings set forth herein:
(a)"Investment opportunity area" means the entire City.
(b)"Deteriorated property" means any industrial or commercial property and improvements thereon located in an investment opportunity area, as hereinafter provided, or any such property which has been the subject of an order by a government agency requiring the unit to be vacated, condemned or demolished by reason of noncompliance with laws, ordinances or regulations.
(c) "Improvement" means 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. Improvements qualifying for exemption shall be those related to improvements to structures and related accessory uses. Ordinary upkeep and maintenance shall not be deemed an improvement.
308.02 ELIGIBLE AREAS.
The investment opportunity area shall be the entire City, except for those properties which are located in a Tax Increment District as set forth in the Pennsylvania Tax Increment Financing Act 113 of 1990, as amended, and Article 310. Any properties located in a Tax Increment District shall be eligible areas when the Tax Increment District terminates. (Ord. 23-1993 §1. Passed 9-7-93.)
308.03 EXEMPTION.
(a) 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 in accordance with the exemption schedule established within this article.
(b) The exemption from real estate taxes shall be limited to that improvement for
which an exemption has been requested in the manner set forth in this article and for which a
separate assessment has been made by the Board of Assessment Appeals.
(Ord. 6-1990 §1. Passed 6-5-90.)
308.04 EXEMPTION SCHEDULE.
(a) The schedule of real estate taxes to be exempted shall be in accordance with the below portion of improvements to be exempted each year:
Lenght (Year) n (Percent)
- First 100
- Second 90
- Third 80
- Fourth 70
- Fifth 60
- Sixth 50
- Seventh 40
- Eighth 30
- Ninth 20
- Tenth 10
(b) If an eligible property is granted tax exemption pursuant to this article, the improvement shall not, during the exemption period, be considered as a factor in assessing other properties.
(c) The exemption from taxes granted under this article shall be upon the property and shall not terminate upon the sale or exchange of the property.
308.05 PROCEDURE FOR OBTAINING EXEMPTION.
(a) At the time a building permit for the construction of an improvement is applied for, the Codes Administration Center shall notify the applicant by printed notice of the possibility of tax exemption under this bill. When the building permit is issued, the taxpayer shall apply for their exemption to the Center by using forms provided. This form shall include a description of improvements to be made.
(b) The Center shall process the application by first scheduling an inspection of the property to determine existing deficiencies which at the completion of the project must be corrected.
(c) Upon completion of the improvements the taxpayer shall notify the Center that the work is done and shall also submit a statement of the actual documented cost of the improvements.
(d) The Center shall conduct an inspection to ensure that the property now meets minimum code standards.
(e) The Center shall notify the Board of Assessment Appeals that the work has been completed and of the actual cost of the improvements.
(f) The Board shall promptly notify the taxpayer, the City and the School Board of the amount of assessment eligible for exemption.
(g) The Center shall send to the School Board and City Treasurer a copy of the application for exemption along with the certification that the work has been completed and that the application for exemption has been approved by the City.
(h) The taxpayer shall submit a copy of the reassessment notice with the Codes Administrator, who in turn shall submit to the City Treasurer and to the School Board a certificate of exemption which details the assessed market value not to be taxed for each year under this program.
(i) The City Treasurer upon receipt of the tax bills from the County shall pull the effected tax bill and reduce it by the amount shown on the above mentioned certificate.
(j) Any applicant whose real estate tax or other lienable charge for any property in the City is not paid by the due date and determined by the City Treasurer, shall forfeit all eligibility under this program.
308.06 TERMINATION DATE.
An application for exemption may be made any time within three years from the effective date of this section. All qualified applicants are eligible for the entire ten year exemption schedule. This article shall terminate three years from the effective date of this section.
308.07 CONFLICT.
Any ordinance or part of any ordinance which conflicts with the provisions of this article is hereby repealed.
308.08 SEVERABILITY.
The provisions of this article are severable and if any of its sections, clauses or sentences shall be held illegal, invalid or unconstitutional, such provisions shall not affect or impair any of the remaining sections, clauses or sentences. It is hereby declared to be the intent of Council that this article would have been adopted if such illegal, invalid or unconstitutional section, clause or sentence had not been included herein.
308.09 REVOCATION OF LERTA PRIVILEGES.
The exemption from real estate taxes provided in this article shall be forfeited by the applicant and/or any subsequent owner of the real estate for failure to pay nonexempt real estate taxes by their due date. Upon receipt of notice of nonpayment of nonexempt real estate taxes the Zoning Officer/Building Official shall direct the City Treasurer to discontinue the LERTA exemption.