2023 Pennsylvania Consolidated & Unconsolidated Statutes › Title 4 - AMUSEMENTS › Chapter 14 - Revenues › Section 1403 - Establishment of State Gaming Fund and net slot machine revenue distribution

§ 1403. Establishment of State Gaming Fund and net slot machine revenue distribution.
(a) Fund established.--
There is hereby established the State Gaming Fund within the State Treasury.
(b) Slot machine tax.--
The department shall determine and each slot machine licensee, other than a Category 4 slot machine licensee, shall pay a daily tax of 34% from its daily gross terminal revenue from the slot machines in operation at its facility and a local share assessment as provided in subsection (c). All funds owed to the Commonwealth, a county or a municipality under this section shall be held in trust by the licensed gaming entity for the Commonwealth, the county and the municipality until the funds are paid or transferred to the fund. Unless otherwise agreed to by the board, a licensed gaming entity shall establish a separate bank account to maintain gross terminal revenue until such time as the funds are paid or transferred under this section. Moneys in the fund are hereby appropriated to the department on a continuing basis for the purposes set forth in subsection (c).
(b.1) Slot machine tax at Category 4 licensed facilities.--
(1) The department shall determine and each Category 4 slot machine licensee shall pay a daily tax of 50% from its daily gross terminal revenue from the slot machines in operation at the Category 4 licensed facility and a local share assessment as provided in subsection (c.1). All money owed to the Commonwealth, a county or a municipality under this section shall be held in trust by the licensed gaming entity for the Commonwealth, the county and the municipality until the money is paid or transferred to the fund. Unless otherwise agreed to by the board, a licensed gaming entity shall establish a separate bank account to maintain gross terminal revenue until such time as the money is paid or transferred under this section. Money in the fund is appropriated to the department on a continuing basis for the purposes set forth in paragraph (2).
(2) The tax imposed under paragraph (1) shall be deposited as follows:
(i) Sixty-eight percent into the Property Tax Relief Fund established under section 1409 (relating to Property Tax Relief Fund).
(ii) Ten percent added to and distributed under section 13B52(d)(2)(ii) (relating to interactive gaming tax).
(iii) Ten percent into a restricted receipts account to be established in the Commonwealth Financing Authority to be used exclusively for grants for projects in the public interest in the Commonwealth.
(iv) Twelve percent added to and distributed under section 1407 (relating to Pennsylvania Gaming Economic Development and Tourism Fund).
(c) Transfers and distributions.--
The department shall:
(1) Transfer the slot machine tax and assessment imposed in subsection (b) to the fund.
(2) From the local share assessment established in subsection (b), make quarterly distributions among the counties hosting a licensed facility in accordance with the following schedule:
(i) If the licensed facility is a Category 1 licensed facility that is located at a harness racetrack and the county, including a home rule county, in which the licensed facility is located is:
(A) (Deleted by amendment).
(B) A county of the second class: 2% of the gross terminal revenue to the county hosting the licensed facility from each such licensed facility.
(C) A county of the second class A: 1% of the gross terminal revenue to the county hosting the licensed facility from each such licensed facility. An additional 1% of the gross terminal revenue to the county hosting the licensed facility from each such licensed facility for the purpose of municipal grants within the county in which the licensee is located.
(D) (I) A county of the third class: Except as provided in subclause (II), 2% of the gross terminal revenue from each such licensed facility shall be deposited into a restricted receipts account to be established in the Commonwealth Financing Authority to be used exclusively for grants for projects in the public interest to municipalities within the county where the licensed facility is located.
(I.1) Priority shall be given to multiyear projects approved or awarded by the Department of Community and Economic Development under subclause (I) on or before January 7, 2010.
(I.2) (Repealed).
(I.3) Notwithstanding the act of February 9, 1999 (P.L.1, No.1), known as the Capital Facilities Debt Enabling Act, grants made under subclause (I) may be utilized as local matching funds for other grants or loans from the Commonwealth.
(II) If a licensed facility is located in one of two counties of the third class where a city of the third class is located in both counties of the third class, the county in which the licensed facility is located shall receive 1.2% of the gross terminal revenue to be distributed as follows: 20% to the host city, 30% to the host county and 50% to the host county for the purpose of making municipal grants within the county, with priority given to municipalities contiguous to the host city. The county of the third class, which includes a city of the third class that is located in two counties of the third class and is not the host county for the licensed facility, shall receive .8% of the gross terminal revenue to be distributed as follows: 60% to a nonhost city of the third class located solely in the nonhost county in which the host city of the third class is also located or 60% to the nonhost city of the third class located both in the host and nonhost counties of the third class, 35% to the nonhost county and 5% to the nonhost county for the purpose of making municipal grants within the county.
(E) A county of the fourth class: 2% of the gross terminal revenue from each such licensed facility shall be distributed as follows:
(I) The department shall make distributions directly to each municipality within the county, except the host municipality, by using a formula equal to the sum of $25,000 plus $10 per resident of the municipality using the most recent population figures provided by the Department of Community and Economic Development, provided, however, that the amount so distributed to any municipality shall not exceed 50% of its total budget for fiscal year 2009 or 2013, whichever is greater, adjusted for inflation in subsequent fiscal years by an amount not to exceed an annual cost-of-living adjustment calculated by applying any upward percentage change in the Consumer Price Index immediately prior to the date the adjustment is due to take effect. Distributions to a municipality in accordance with this subclause shall be deposited into a special fund which shall be established by the municipality. The governing body of the municipality shall have the right to draw upon the special fund for any lawful purpose provided that the municipality identifies the fund as the source of the expenditure. Each municipality shall annually submit a report to the Department of Community and Economic Development detailing the amount and purpose of each expenditure made from the special fund during the prior fiscal year.
(II) Any funds not distributed under subclause (I) shall be deposited into a restricted receipts account established in the Department of Community and Economic Development to be used exclusively for grants to the county, to economic development authorities or redevelopment authorities within the county for grants for economic development projects, infrastructure projects, job training, community improvement projects, other projects in the public interest, and necessary and reasonable administrative costs. Notwithstanding the provisions of the act of February 9, 1999 (P.L.1, No.1), known as the Capital Facilities Debt Enabling Act, grants made under this clause may be utilized as local matching funds for other grants or loans from the Commonwealth.
(F) Counties of the fifth through eighth classes:
(I) Except as set forth in subclause (II), 2% of the gross terminal revenue from each such licensed facility shall be deposited into a restricted account established in the Department of Community and Economic Development to be used exclusively for grants to the county.
(II) If the licensed facility is located in a second class township in a county of the fifth class, 2% of the gross terminal revenue from the licensed facility shall be distributed as follows:
(a) 1% shall be deposited into a restricted receipts account to be established in the Commonwealth Financing Authority to be used exclusively for grants for projects in the public interest to municipalities within the county where the licensed facility is located.
(b) 1% shall be distributed to the county for projects in the public interest in the county.
(G) Any county not specifically enumerated in clauses (A) through (F), 2% of the gross terminal revenue to the county hosting the licensed facility from each such licensed facility.
(ii) If the licensed facility is a Category 1 licensed facility and is located at a thoroughbred racetrack and the county in which the licensed facility is located is:
(A) (Deleted by amendment).
(B) A county of the second class: 2% of the gross terminal revenue to the county hosting the licensed facility from each such licensed facility.
(C) A county of the second class A: 1% of the gross terminal revenue to the county hosting the licensed facility from each such licensed facility for the purpose of funding nonprofit entities fulfilling a human service, victim assistance or drug and alcohol prevention and treatment within the county in which the licensed facility is located. An additional 1% of the gross terminal revenue to a redevelopment authority in the county hosting the licensed facility from each such licensed facility for the purpose of municipal grants within the county in which the licensee is located. The redevelopment authority shall retain 5% of the total funds administered to cover the costs and expenses of administration of the grants. For purposes of this subparagraph, a municipality that is wholly within the boundaries of a contiguous municipality shall be considered a contiguous municipality and eligible to receive municipal grants under this subparagraph.
(D) A county of the third class which is also a home rule county: 1% of the gross terminal revenue to the county hosting the licensed facility from each such licensed facility. An additional 1% of the gross terminal revenue minus the amount contained in clause (D.1) to the county hosting the licensed facility from each such licensed facility for the purpose of municipal grants within the county in which the licensee is located.
(D.1) $1,000,000 of the gross terminal revenue annually to a land bank jurisdiction established by a county of the third class which is also a home rule county. Until a land bank jurisdiction is established by a county of the third class which is also a home rule county after the effective date of this subclause, $1,000,000 to the county redevelopment authority.
(D.2) An economic or redevelopment authority which administers local share assessment funds for a county of the third class, which is also a home rule county in which a Category 1 licensed facility is located at a thoroughbred racetrack, shall be subject to the following:
(I) Each expenditure of the local share assessment funds by the authority shall be disclosed on the authority's publicly accessible Internet website.
(II) Local share assessment funds received by the authority may not be used to pay for tuition or other educational expenses of an officer or employee of the authority.
(III) Each expenditure of local share assessment funds by the authority shall include a disclosure that the funds originated from licensed gaming activities.
(IV) The authority shall be subject to audit by the Auditor General.
(D.3) A county of the third class which is not a home rule county: 1% of the gross terminal revenue to the county hosting the licensed facility from each such licensed facility minus amounts in clauses (D.4), (D.5), (D.6) and (D.7). An additional 1% of the gross terminal revenue to the county hosting the licensed facility from each such licensed facility for the purpose of municipal grants within the county in which the licensee is located. Notwithstanding the provisions of the Capital Facilities Debt Enabling Act, grants made under this clause may be utilized as local matching funds for other grants or loans from the Commonwealth.
(D.4) $220,000 of the gross terminal revenue annually shall be deposited into a restricted receipts account to be established in the Commonwealth Financing Authority to be used exclusively for grants for projects in the public interest within a contiguous county containing a township that receives a portion of the licensed facility's slot machine operation fee under paragraph (3)(v)(C) for the purpose of municipal grants within the county. Notwithstanding the provisions of the Capital Facilities Debt Enabling Act, grants made under this clause may be utilized as local matching funds for other grants or loans from the Commonwealth.
(D.5) $50,000 of the gross terminal revenue annually to a contiguous county of the fourth class for fire and emergency services and economic development. Notwithstanding the provisions of the Capital Facilities Debt Enabling Act, grants made under this clause may be utilized as local matching funds for other grants or loans from the Commonwealth.
(D.6) $30,000 of the gross terminal revenue annually to a township of the second class with a population between 2,000 and 2,500 as of the 2010 decennial census that is contiguous to a township in a county of the fifth class that receives a portion of the licensed facility's slot machine operation fee under paragraph (3)(v)(C).
(D.7) $30,000 of the gross terminal revenue annually to a township of the second class with a population between 8,000 and 8,100 as of the 2010 decennial census that is contiguous to a township in a county of the fifth class that receives a portion of the licensed facility's slot machine operation fee under paragraph (3)(v)(C). The township may use the amount for any purpose, provided that funding for fire and other emergency services is prioritized.
(E) A county of the fourth class: 2% of the gross terminal revenue from each such licensed facility shall be deposited into a restricted account established in the Department of Community and Economic Development to be used exclusively for grants to the county, to economic development authorities or redevelopment authorities within the county for grants for economic development projects, community improvement projects, job training, other projects in the public interest and reasonable administrative costs. Notwithstanding the Capital Facilities Debt Enabling Act, grants made under this clause may be utilized as local matching funds for other grants or loans from the Commonwealth.
(F) Counties of the fifth through eighth classes: 2% of the gross terminal revenue from each such licensed facility shall be deposited into a restricted account established in the Department of Community and Economic Development to be used exclusively for grants to the county.
(G) Any county not specifically enumerated in clauses (A) through (F), 2% of the gross terminal revenue to the county hosting the licensed facility from each such licensed facility.
(iii) If the facility is a Category 2 licensed facility and if the county in which the licensed facility is located is:
(A) (Deleted by amendment).
(B) A county of the second class: 2% of the gross terminal revenue to the county hosting the licensed facility from each such licensed facility.
(C) A county of the second class A: 1% of the gross terminal revenue to the county hosting the licensed facility from each such licensed facility. An additional 1% of the gross terminal revenue to the county hosting the licensed facility from each such licensed facility for the purpose of municipal grants within the county in which the licensee is located.
(D) A county of the third class: 1% of the gross terminal revenue to the county hosting the licensed facility from each such licensed facility. An additional 1% of the gross terminal revenue to the county hosting the licensed facility from each such licensed facility for the purpose of municipal grants within the county in which the licensee is located.
(D.1) If a licensed facility is located in one of two counties of the third class where a city of the third class is located in both counties of the third class, the following shall apply:
(I) The county in which the licensed facility is located shall receive 1.2% of the gross terminal revenue to be distributed as follows:
(a) 20% shall be distributed to the host city.
(b) 30% shall be distributed to the host county.
(c) 50% shall be distributed as follows:
(1) Beginning January 1, 2018, the sum of $250,000 shall be distributed annually for a period of 20 years to a city of the third class located in two counties of the third class for purposes of funding the redevelopment of an existing arts and education center that has professional artist space and studios and is located within the city of the third class that is located in two counties of the third class.
(2) After the distribution under subunit (1), the remaining funds shall be deposited into a restricted receipts account to be established in the Commonwealth Financing Authority for distribution within the host county to be used exclusively for economic development projects, community improvement projects and other projects in the public interest within the host county, with priority given to municipalities contiguous to the host city.
(II) The county of the third class, which includes a city of the third class that is located in two counties of the third class and is not the host county for the licensed facility, shall receive .8% of the gross terminal revenue to be distributed as follows:
(a) 60% shall be distributed to a nonhost city of the third class located solely in the nonhost county in which the host city of the third class is also located or 60% to the nonhost city of the third class located both in the host and nonhost counties of the third class.
(b) 35% shall be distributed to the nonhost county.
(c) 5% shall be deposited into a restricted receipts account to be established in the Commonwealth Financing Authority for distribution within the nonhost county to be used exclusively for economic development projects, community improvement projects and other projects in the public interest within the nonhost county, with priority given to municipalities contiguous to the host city.
(E) A county of the fourth class: 2% of the gross terminal revenue from each such licensed facility shall be deposited into a restricted account established in the Department of Community and Economic Development to be used exclusively for grants to the county, to economic development authorities or redevelopment authorities within the county for grants for economic development projects, community improvement projects, job training, other projects in the public interest and reasonable administrative costs. Notwithstanding the Capital Facilities Debt Enabling Act, grants made under this clause may be utilized as local matching funds for other grants or loans from the Commonwealth.
(F) Counties of the fifth class: 2% of the gross terminal revenue from each such licensed facility shall be deposited and distributed as follows:
(I) One percent to be distributed as follows:
(a) Beginning in 2010, the sum of $2,400,000 annually for a period of 20 years to the county for purposes of funding debt service related to the construction of a community college campus located within the county.
(b) Any funds not distributed under subclause (a) shall be deposited into a restricted receipts account to be established in the Commonwealth Financing Authority to be used exclusively for grants within the county for economic development projects, road projects located within a 20-mile radius of the licensed facility and located within the county, community improvement projects and other projects in the public interest within the county. The amount under this subclause includes reasonable administrative costs.
(II) One percent shall be distributed as follows:
(a) Beginning January 1, 2018, the sum of $250,000 shall be distributed annually for a period of 20 years to a contiguous county of the third class that hosts a Category 2 licensed facility, for the purpose of funding the construction of a pool and indoor recreation facility at an existing nonprofit recreation center within the contiguous county in a borough with a population between 3,400 and 3,800 at the 2010 decennial census.
(b) After the distribution under subunit (a), the remaining funds shall be deposited into a restricted receipts account to be established in the Commonwealth Financing Authority to be used exclusively for grants within contiguous counties for economic development projects, community improvement projects and other projects in the public interest within contiguous counties. The amount under this subclause includes reasonable administrative costs. A contiguous county that hosts a Category 1 licensed facility shall be ineligible to receive grants under this subclause.
(II.1) Priority shall be given to multiyear projects approved or awarded by the Department of Community and Economic Development under subclause (I)(b) or (II) on or before January 7, 2010.
(III) Fifty percent of any revenue required to be transferred under paragraph (3)(v) shall be deposited into the restricted receipts account established under subclause (I)(b), and 50% shall be deposited into the restricted receipts account established under subclause (II). Notwithstanding the Capital Facilities Debt Enabling Act, grants made under this clause may be utilized as local matching funds for other grants or loans from the Commonwealth.
(G) Any county not specifically enumerated in clauses (B) through (F), 2% of the gross terminal revenue to the county hosting the licensed facility from each such licensed facility.
(iv) (A) Except as provided in clause (B) or (C), if the facility is a Category 3 licensed facility, 2% of the gross terminal revenue from the licensed facility shall be deposited into a restricted receipts account established in the Department of Community and Economic Development to be used exclusively for grants to the county, to economic development authorities or redevelopment authorities within the county for grants for economic development projects, community improvement projects and other projects in the public interest.
(B) If the facility is a Category 3 licensed facility located in a county of the second class A, 2% of the gross terminal revenue to the county hosting the licensed facility from each such licensed facility shall be deposited as follows:
(I) Seventy-five percent shall be deposited for the purpose of supporting the maintenance and refurbishment of the parks and heritage sites throughout the county in which the licensed facility is located.
(II) Twelve and one-half percent shall be deposited for the purpose of supporting a child advocacy center located within the county in which the licensed facility is located.
(III) Twelve and one-half percent shall be deposited for the purpose of supporting an organization providing comprehensive support services to victims of domestic violence, including legal and medical aid, shelters, transitional housing and counseling located within the county in which the licensed facility is located.
(C) If the facility is a Category 3 licensed facility located in a county of the fifth class that is contiguous to a county of the seventh class, 2% of the gross terminal revenue from the licensed facility shall be deposited into a restricted receipts account to be established in the Commonwealth Financing Authority to be used exclusively for grants within the county for economic development projects, infrastructure projects, community improvement projects and other projects in the public interest within the county and for infrastructure projects within a 20-mile radius of the licensed facility in a contiguous county of the seventh class.
(v) Unless otherwise specified, for the purposes of this paragraph money designated for municipal grants within a county, other than a county of the first class, in which a licensed facility is located shall be used to fund grants to the municipality in which the licensed facility is located, to the county in which the licensed facility is located and to the municipalities which are contiguous to the municipality in which the licensed facility is located and which are located within the county in which the licensed facility is located. Grants shall be administered by the county through its economic development or redevelopment authority in which the licensed facility is located. Grants shall be used to fund the costs of human services, infrastructure improvements, facilities, emergency services, health and public safety expenses associated with licensed facility operations. If at the end of a fiscal year uncommitted funds exist, the county shall pay to the economic development or redevelopment authority of the county in which the licensed facility is located the uncommitted funds.
(vi) If the licensed facility is located in more than one county, the amount available shall be distributed on a pro rata basis determined by the percentage of acreage located in each county to the total acreage of all counties occupied by the licensed facility.
(vii) The distributions provided in this paragraph shall be based upon county classifications in effect on July 5, 2004. Any reclassification of counties as a result of a Federal decennial census or of a State statute shall not apply to this subparagraph.
(viii) If any provision of this paragraph is found to be unenforceable for any reason, the distribution provided for in the unenforceable provision shall be made to the county in which the licensed facility is located for the purposes of grants to municipalities in that county, including municipal grants as specified in subparagraph (v).
(ix) Nothing in this paragraph shall prevent any of the above counties which directly receive a distribution under this section from entering into intergovernmental cooperative agreements with other jurisdictions for sharing this money.
(x) The department shall credit against the amount imposed under this paragraph any amount paid by a licensed facility from May 27, 2017, until the effective date of this paragraph to a county under an agreement between the Category 1, Category 2 or Category 3 licensed gaming entity and the county in lieu of a payment under this paragraph, as certified to the department by the county receiving the funds.
(3) From the slot machine license operation fees deposited into the fund under section 1326.1(e) (relating to slot machine license operation fee), make quarterly distributions among the municipalities, including home rule municipalities, hosting a licensed facility in accordance with the following schedule:
(i) To a city of the second class hosting a licensed facility, other than a Category 3 or Category 4 licensed facility, $10,000,000 annually shall be distributed to the city treasury.
(ii) To a city of the second class A hosting a licensed facility, other than a Category 3 or Category 4 licensed facility, $10,000,000 annually shall be distributed to the city, subject, however, to the budgetary limitation in this subparagraph. The amount allocated to the designated municipalities shall not exceed 50% of their total budget for fiscal year 2003-2004, adjusted for inflation in subsequent years by an amount not to exceed an annual cost-of-living adjustment calculated by applying the percentage change in the Consumer Price Index immediately prior to the date the adjustment is due to take effect. Any remaining moneys shall be distributed in accordance with paragraph (2) based upon the classification of county where the licensed facility is located.
(iii) To a city of the third class hosting a licensed facility, other than a Category 3 or Category 4 licensed facility, $10,000,000 annually, less any amount up to $5,000,000 received pursuant to a written agreement with a licensed gaming entity executed prior to the effective date of this part, shall be distributed to the city, subject, however, to the budgetary limitation in this subparagraph. In the event that the city has a written agreement with a licensed gaming entity executed prior to July 5, 2004, the amount paid under the agreement to the city shall be applied and credited, up to $5,000,000, to the slot machine license operation fee owed under section 1326.1. The amount allocated to the designated municipalities shall not exceed 50% of their total budget for fiscal year 2003-2004, adjusted for inflation in subsequent years by an amount not to exceed an annual cost-of-living adjustment calculated by applying the percentage change in the Consumer Price Index immediately prior to the date the adjustment is due to take effect. Any remaining moneys shall be distributed in accordance with paragraph (2) based upon the classification of county where the licensed facility is located.
(iii.1) If a licensed facility, other than a Category 3 or Category 4 licensed facility, is located in a city of the third class and the city is located in more than one county of the third class, $10,000,000 annually shall be distributed as follows: 80% to the host city and 20% to the city of the third class located solely in a nonhost county in which the host city of the third class is also located. If a licensed facility, other than a Category 3 or Category 4 licensed facility, is located in a city of the third class and that city is located solely in a host county of the third class in which a nonhost city of the third class is also located, $10,000,000 annually shall be distributed as follows: 80% to the host city and 20% to a city of the third class located both in a nonhost county of the third class and in a host county of the third class in which the host city of the third class is located.
(iv) To a township of the first class hosting a licensed facility, other than a Category 3 or Category 4 licensed facility, $10,000,000 annually shall be distributed to the township, subject, however, to the budgetary limitation in this subparagraph. The amount allocated to the designated municipalities shall not exceed 50% of their total budget for fiscal year 2003-2004, adjusted for inflation in subsequent years by an amount not to exceed an annual cost-of-living adjustment calculated by applying the percentage change in the Consumer Price Index immediately prior to the date the adjustment is due to take effect. Any remaining money shall be distributed in accordance with paragraph (2) based upon the classification of county where the licensed facility is located.
(v) To a township of the second class hosting a licensed facility:
(A) $10,000,000 annually shall be distributed to the township of the second class hosting a licensed facility, other than a Category 3 or Category 4 licensed facility or a licensed facility located in more than one township of the second class, subject, however, to the budgetary limitation in this subparagraph. The amount allocated to the designated municipalities shall not exceed 50% of their total budget for fiscal year 2003-2004, adjusted for inflation in subsequent years by an amount not to exceed an annual cost-of-living adjustment calculated by applying the percentage change in the Consumer Price Index immediately prior to the date the adjustment is due to take effect. Any remaining money shall be distributed in accordance with paragraph (2) based upon the classification of county where the licensed facility is located.
(B) $10,000,000 annually, less the amount paid under clause (C), shall be distributed to the township of the second class hosting a licensed facility which owns land adjacent to the licensed facility located in more than one township of the second class, other than a Category 3 or Category 4 licensed facility, subject, however, to the budgetary limitation in this subparagraph. The amount allocated to the designated municipalities may not exceed 50% of their total budget for the fiscal year 2003-2004, adjusted for inflation in subsequent years by an amount not to exceed an annual cost-of-living adjustment calculated by applying the percentage change in the Consumer Price Index immediately prior to the date the adjustment is due to take effect. Any remaining money shall be distributed in accordance with paragraph (2) based upon the classification of the county where the licensed facility is located. The county commissioners of a county of the third class in which the licensed facility is located shall appoint an advisory committee for the purpose of advising the county as to the need for municipal grants for health, safety, transportation and other projects in the public interest to be comprised of two individuals from the host municipality, two from contiguous municipalities within the county of the third class and one from the host county.
(C) For land owned by a licensed gaming entity, other than a Category 3 or Category 4 licensed facility, and located in more than one township of the second class: $160,000 shall be distributed annually to the township of the second class which is located in a county of the fifth class if the land owned, including racetracks, grazing fields and other adjoining real property, is adjacent to the licensed facility.
(vi) To a borough hosting a licensed facility, other than a Category 3 or Category 4 licensed facility, $10,000,000 annually shall be distributed to the borough, subject, however, to the budgetary limitation in this subparagraph. The amount allocated to the designated municipalities shall not exceed 50% of their total budget for fiscal year 2003-2004, adjusted for inflation in subsequent years by an amount not to exceed an annual cost-of-living adjustment calculated by applying the percentage change in the Consumer Price Index immediately prior to the date the adjustment is due to take effect. Any remaining money shall be distributed in accordance with paragraph (2) based upon the classification of county where the licensed facility is located.
(vii) To an incorporated town hosting a licensed facility, other than a Category 3 or Category 4 licensed facility, $10,000,000 annually shall be distributed to the incorporated town, subject, however, to the budgetary limitation in this subparagraph. The amount allocated to the designated municipalities shall not exceed 50% of their total budget for fiscal year 2003-2004, adjusted for inflation in subsequent years by an amount not to exceed an annual cost-of-living adjustment calculated by applying the percentage change in the Consumer Price Index immediately prior to the date the adjustment is due to take effect. Any remaining money shall be distributed in accordance with paragraph (2) based upon the classification of county where the licensed facility is located.
(viii) (A) (Deleted by amendment).
(B) (Deleted by amendment).
(C) (Deleted by amendment).
(ix) (Deleted by amendment).
(x) (Deleted by amendment).
(xi) (Deleted by amendment).
(xii) (Deleted by amendment).
(xiii) (Deleted by amendment).
(xiv) (Deleted by amendment).
(xv) (Deleted by amendment).
(A) (Deleted by amendment).
(B) (Deleted by amendment).
(C) (Deleted by amendment).
(4) From the slot machine license operation fee deposited into the fund under section 1326.1(e), make quarterly distributions totaling $10,000,000 for each licensed facility located within a county and city of the first class which is coterminous as follows:
(i) If a licensed facility is a Category 1 or Category 2 licensed facility and is operating in a county and city of the first class which is coterminous on the effective date of this paragraph, the first $5,000,000 shall be distributed annually to a school district of the first class. Of the remaining funds, 60% shall be distributed to the county and city of the first class which is coterminous and 40% shall be deposited into a restricted receipts account established in the Department of Community and Economic Development to be used exclusively for grants for economic development projects, neighborhood revitalization projects, community improvement projects and other projects in the public interest within the county and city of the first class which is coterminous.
(ii) If a licensed facility is a Category 1 or Category 2 licensed facility and begins operating in a county and city of the first class which is coterminous after the effective date of this paragraph, 70% of the slot machine license operation fee shall be distributed to the county and city of the first class which is coterminous and 30% of the slot machine license operation fee shall be deposited into a restricted receipts account established in the Department of Community and Economic Development to be used exclusively for grants for economic development projects, neighborhood revitalization projects, community improvement projects and other projects in the public interest within the county and city of the first class which is coterminous.
(iii) Notwithstanding any other provision of this part to the contrary, slot machine license operation fees from licensed gaming entities located within a county and city of the first class shall not be distributed outside a county and city of the first class.
(5) From the local share assessment established in subsection (b), make quarterly distributions among the municipalities, including home rule municipalities, hosting a licensed facility in accordance with the following schedule:
(i) Except as provided in subparagraph (ii) or (iii), to a municipality of any class hosting a Category 3 facility, 2% of the gross terminal revenue from the Category 3 licensed facility located in the municipality, subject, however, to the budgetary limitation in this subparagraph. The amount allocated to the designated municipalities shall not exceed 50% of their total budget for fiscal year 2009, adjusted for inflation in subsequent years by an amount not to exceed an annual cost-of-living adjustment calculated by applying the percentage change in the Consumer Price Index immediately prior to the date the adjustment is due to take effect. Any remaining money shall be collected by the department from each licensed gaming entity and distributed in accordance with paragraph (2) based upon the classification of county where the licensed facility is located.
(ii) If the municipality hosting a Category 3 licensed facility is a borough located in a county of the third class and the borough is contiguous to a city of the third class, 1% of gross terminal revenue shall be distributed to the host borough and 1% of gross terminal revenue shall be distributed to the city of the third class that is contiguous to the host borough, subject, however, to the budgetary limitation in this subparagraph. The amount allocated to each designated municipality shall not exceed 50% of its total budget for fiscal year 2009, adjusted for inflation in subsequent years by an amount not to exceed an annual cost-of-living adjustment calculated by applying the percentage increase, if any, in the Consumer Price Index immediately prior to the date the adjustment is due to take effect. Any remaining money shall be collected by the department from each licensed gaming entity and distributed in accordance with paragraph (2) based upon the classification of county where the licensed facility is located.
(iii) If the municipality hosting a Category 3 licensed facility is a township of the second class in a county of the fifth class which is contiguous to a county of the seventh class, 2% of the gross terminal revenue from the Category 3 licensed facility located in the municipality shall be distributed to the municipality, subject, however, to the budgetary limitation in this subparagraph. The amount allocated to the designated municipalities shall not exceed the lesser of $1,000,000 or 50% of their total budget for fiscal year 2009, adjusted for inflation in subsequent years by an amount not to exceed an annual cost-of-living adjustment calculated by applying the percentage change in the Consumer Price Index immediately prior to the date the adjustment is due to take effect. Any remaining money shall be collected by the department from each licensed gaming entity and distributed in equal amounts to each municipality contiguous to the host municipality. The amount to be allocated to any contiguous municipality shall not exceed the lesser of $1,000,000 or 50% of the municipality's total budget for fiscal year 2009, adjusted for inflation in subsequent years by an amount not to exceed an annual cost-of-living adjustment calculated by applying the percentage change in the Consumer Price Index immediately prior to the date the adjustment is due to take effect. Any money remaining following distribution to contiguous municipalities shall be collected by the department and distributed in accordance with paragraph (2) based upon the classification of county where the licensed facility is located.
(iv) The department shall credit against the amount imposed under this paragraph any amount paid by a licensed facility from May 27, 2017, until the effective date of this paragraph, to a municipality under an agreement between a Category 3 licensed gaming entity and the municipality in lieu of a payment under this paragraph, as certified to the department by the municipality receiving the funds.
(6) From the slot machine license operation fees deposited in the fund under section 1326.1(e), make quarterly distributions to any municipality not specifically enumerated in paragraph (3) or (4) hosting a Category 1 or Category 2 licensed facility, other than a Category 1 or Category 2 licensed facility located in a city of the first class, equal to $10,000,000 annually.
(7) From the local share assessment established in subsection (b), make quarterly distributions to any municipality not enumerated in paragraph (5) hosting a Category 3 licensed facility: 2% of the gross terminal revenue paid by each licensed gaming entity operating a Category 3 licensed facility.
(8) If a licensed facility is located in more than one municipality, the amount available shall be distributed on a pro rata basis determined by the percentage of acreage located in each municipality to the total acreage of all municipalities occupied by the licensed facility.
(9) If a licensed facility is located at a resort which is also an incorporated municipality, the municipality shall not be eligible to receive any distribution under paragraph (3), (4), (5), (6) or (7). The distribution it would have otherwise been entitled to under paragraph (3), (4), (5), (6) or (7) shall instead be distributed in accordance with paragraph (2) based upon the classification of county where the licensed facility is located.
(10) The distributions provided in paragraph (3), (4), (5), (6) or (7) shall be based upon municipal classifications in effect on July 5, 2004. For the purposes of paragraphs (3), (4), (5), (6) and (7), any reclassification of municipalities as a result of a Federal decennial census or of a State statute shall not apply to paragraphs (3), (4), (5), (6) and (7).
(11) If any provision of paragraph (3), (4), (5), (6) or (7) is found to be unenforceable for any reason, the distribution provided for in the unenforceable provision shall be made to the municipality in which the licensed facility is located.
(12) Nothing in paragraph (3), (4), (5), (6) or (7) shall be construed to prevent any of the above municipalities from entering into intergovernmental cooperative agreements with other jurisdictions for sharing the funds distributed to them.
(13) Notwithstanding any other law, agreement or provision in this part to the contrary, all revenues provided, directed or earmarked under this section to or for the benefit of a city of the second class in which an intergovernmental cooperation authority has been established and is in existence under the act of February 12, 2004 (P.L.73, No.11), known as the Intergovernmental Cooperation Authority Act for Cities of the Second Class, shall be directed to and under the exclusive control of the intergovernmental cooperation authority to be used:
(i) to reduce the debt of the city of the second class;
(ii) to increase the level of funding of the municipal pension funds of the city of the second class; or
(iii) for any other purposes as determined to be in the best interest of the city of the second class by the intergovernmental cooperation authority. The revenues shall not be directed to or under the control of the city of the second class or any coordinator appointed under the act of July 10, 1987 (P.L.246, No.47), known as the Municipalities Financial Recovery Act, for the city of the second class.
(c.1) Local share assessment.--
(1) In addition to the tax imposed under paragraph (b.1), each Category 4 slot machine licensee shall pay on a weekly basis and on a form and in a manner prescribed by the department a local share assessment into a restricted receipts account established within the fund. All funds owed under this section shall be held in trust by the Category 4 slot machine licensee until the funds are paid into the account. Funds in the account are hereby appropriated to the department on a continuing basis for the purposes set forth in paragraph (2).
(2) From the local share assessment established in paragraph (1), make quarterly distributions as follows:
(i) Fifty percent shall be deposited into a restricted receipts account to be established in the Commonwealth Financing Authority to be used exclusively for grants for projects in the public interest in the county hosting the Category 4 licensed facility.
(ii) Fifty percent to the municipality hosting the Category 4 licensed facility from each Category 4 licensed facility shall be paid by each licensed gaming entity operating a Category 4 licensed facility in the municipality, subject to the budgetary limitation in this subparagraph. The amount allocated to the designated municipalities shall not exceed 50% of the municipality's total budget for fiscal year 2016-2017, adjusted for inflation in subsequent years by an amount not to exceed an annual cost-of-living adjustment calculated by applying the percentage change in the Consumer Price Index immediately prior to the date the adjustment is due to take effect. Any remaining money shall be collected by the department from each licensed gaming entity and distributed in accordance with subparagraph (i).
(3) For purposes of this subsection, local share assessment shall be 4% of the gross terminal revenues generated at a Category 4 licensed facility.
(d) Consumer Price Index.--
For purposes of subsection (c), references to the Consumer Price Index shall mean the Consumer Price Index for All Urban Consumers for the Pennsylvania, New Jersey, Delaware and Maryland area for the most recent 12-month period for which figures have been officially reported by the United States Department of Labor, Bureau of Labor Statistics.
(e) Reporting.--
(1) In cooperation with the department and the Commonwealth Financing Authority, the Department of Community and Economic Development shall submit an annual report on all distributions of local share assessments and slot machine license operation fees to counties and municipalities under this section to the chairman and minority chairman of the Appropriations Committee of the Senate, the chairman and minority chairman of the Community, Economic and Recreational Development Committee of the Senate, the chairman and minority chairman of the Appropriations Committee of the House of Representatives and the chairman and minority chairman of the Gaming Oversight Committee of the House of Representatives. The report shall be submitted by March 31, 2018, and by March 31 of each year thereafter.
(2) All counties and municipalities receiving distributions of local share assessments or slot machine license operation fees under this section shall submit information to the Department of Community and Economic Development on a form prepared by the Department of Community and Economic Development that sets forth the amount and use of the funds received in the prior calendar year. The form shall set forth whether the funds received were deposited in the county's or municipality's General Fund or committed to a specific project or use.
(f) Prohibited activities.--
(1) A person or its affiliated entity or a political subdivision shall not compensate or incur an obligation to compensate a person to engage in lobbying for compensation contingent in whole or in part upon the approval, award, receipt or denial of funds under this section. A person or its affiliated entity shall not engage in or agree to engage in lobbying for compensation contingent in whole or in part upon the approval, award, receipt or denial of funds under this section. This subsection shall not apply to a county or municipality that compensates a person to prepare a grant application for funds under this section if the following requirements are met:
(i) The person is not identified in the application.
(ii) The person has no direct contact with the agency, county or municipality providing the funding.
(iii) The person is paid a fixed fee or percentage of the amount of any funds approved, awarded or received up to .5%.
(2) A violation of this section shall be considered an intentional violation of 65 Pa.C.S. § 13A09(e) (relating to penalties).
(Nov. 1, 2006, P.L.1243, No.135, eff. imd.; Jan. 7, 2010, P.L.1, No.1, eff. imd.; Oct. 30, 2017, P.L.419, No.42; June 30, 2021, P.L.62, No.24, eff. July 1, 2021)
2021 Repeal.
Act 24 repealed subsec. (c)(2)(i)(D)(I.2).
2017 Amendment.
Act 42 reenacted and amended section 1403. Except as set forth in section 33 of Act 42, section 34(3) of Act 42 provided that the reenactment and amendment of section 1403 shall be retroactive to January 1, 2017. See section 33 of Act 42 in the appendix to this title for special provisions relating to duties of Department of Revenue.
Cross References.
Section 1403 is referred to in sections 1103, 1208, 1209, 1313, 1326.1, 13A63, 13B52, 13B53 of this title.