An Act amending the act of March 4, 1971 (P.L.6, No.2), known as the Tax Reform Code of 1971, in neighborhood improvement zones, further providing for Neighborhood Improvement Zone Funds and providing for Small Business Opportunity Program.

PRINTER'S NO. 3700
THE GENERAL ASSEMBLY OF PENNSYLVANIA
HOUSE BILL
No. 2665
Session of
2026
INTRODUCED BY TIBURCIO, SCHLOSSBERG AND MADDEN, JUNE 24, 2026
REFERRED TO COMMITTEE ON COMMERCE, JUNE 24, 2026
AN ACT
Amending the act of March 4, 1971 (P.L.6, No.2), entitled "An
act relating to tax reform and State taxation by codifying
and enumerating certain subjects of taxation and imposing
taxes thereon; providing procedures for the payment,
collection, administration and enforcement thereof; providing
for tax credits in certain cases; conferring powers and
imposing duties upon the Department of Revenue, certain
employers, fiduciaries, individuals, persons, corporations
and other entities; prescribing crimes, offenses and
penalties," in neighborhood improvement zones, further
providing for Neighborhood Improvement Zone Funds and
providing for Small Business Opportunity Program.
The General Assembly of the Commonwealth of Pennsylvania
hereby enacts as follows:
Section 1. Section 1904-B(g)(1) of the act of March 4, 1971
(P.L.6, No.2), known as the Tax Reform Code of 1971, is amended
to read:
Section 1904-B. Neighborhood Improvement Zone Funds.
* * *
(g) Excess money.--Within 30 days of the end of each
calendar year, any money remaining in the fund of each
contracting authority at the end of the prior calendar year
after the required payments under subsection (d)(2) were made in
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the prior calendar year shall be refunded in the following
manner:
(1) Money shall first be [returned to the General Fund
to the extent that the excess money is part of the transfer
under subsection (d)(1).] used to satisfy all required
payments under this article, including debt service, reserve
requirements, contractual obligations and other obligation of
the contracting authority. After satisfaction of the required
payments, an amount equal to 25% of the baseline tax revenues
received by the contracting authority for the preceding
calendar year shall be transferred to the Small Business
Opportunity Fund established under section 1910-B. Any
balance of the money shall be distributed or expended as
otherwise provided by law.
* * *
Section 2. The act is amended by adding a section to read:
Section 1910-B. Small Business Opportunity Program.
(a) Establishment.--Each contracting authority shall
establish a small business opportunity program within the
authority to encourage the creation, expansion and retention of
small businesses within the authority's designated neighborhood
improvement zone.
(b) Purpose.--The purpose of the program shall be to:
(1) stimulate local entrepreneurship and promote job
creation;
(2) support early stage and microenterprise development;
and
(3) strengthen local economic vitality.
(c) Eligibility.--A business shall be eligible to
participate in the program if the business:
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(1) is a small business;
(2) employs one or more full-time equivalent employees
working at least 35 hours weekly; and
(3) submits an application, as determined by the
department, to the contracting authority.
(d) Grants.--Excess money refunded to the contracting
authority under section 1904-B(g)(1) shall be deposited into an
account established by the contracting authority for the sole
purpose of providing grants, to which the following shall apply:
(1) The department shall settle, assess or determine the
tax of an applicant under this subsection not later than 90
days after the filing of all required final returns or
reports in accordance with section 806.1(a)(5) of the act of
April 9, 1929 (P.L.343, No.176), known as The Fiscal Code.
(2) Before an application is approved, the department
shall make a finding that the applicant has filed all
required State tax reports and returns for all applicable
taxable years and paid any balance of State tax due as
determined at settlement, assessment or determination by the
department.
(3) Any interest accrued on money within the account
established under this subsection shall be retained for
future use by the program.
(4) If the Department of Community and Economic
Development denies an application for a tax credit or tax
benefit program, the applicant may appeal in a manner
established by the Department of Community and Economic
Development.
(e) Reporting.--The contracting authority administering
incentives under this section shall submit an annual report to
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the department and the General Assembly detailing:
(1) the number of participating businesses;
(2) total incentives awarded;
(3) jobs created or retained; and
(4) economic impact within the zone.
(f) Regulations.--The department shall promulgate
regulations necessary to implement and administer this section.
(g) Confidentiality.--Notwithstanding any law providing for
the confidentiality of tax records, the contracting authority
and the local taxing authorities shall have access to any
reports and certifications filed under this article, and the
contracting authority shall have access to any State or local
tax information, including taxpayer identification numbers of a
qualified business located in the neighborhood improvement zone,
filed by a qualified business in the neighborhood improvement
zone solely for the purpose of documenting the certifications
required by this article or determining the amount allocated to
any uses specified under section 1904-B(e)(1). The independent
auditing firm hired under section 1904-B(h) shall have access to
any State or local tax information filed by a qualified business
located in the neighborhood improvement zone, including taxpayer
identification numbers, solely for the purpose of performing an
audit required by section 1904-B(h). Any other use of the tax
information shall be prohibited as provided under law.
(h) Definitions.--As used in this section, the following
words and phrases shall have the meanings given to them in this
subsection unless the context clearly indicates otherwise:
"Small business." As defined under 12 Pa.C.S. § 2302
(relating to definitions).
Section 3. This act shall take effect as follows:
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(1) The addition of section 1910-B(g) of the act shall
take effect in 30 days.
(2) This section shall take effect immediately.
(3) The remainder of this act shall take effect in 60
days.
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