HARRISBURG, June 27 – State Rep. Joseph Petrarca will introduce a bill to exempt from the realty transfer tax all real estate transactions involving a land bank.
Created by state law in 2012, land banks are entities that focus on converting vacant, abandoned, tax-delinquent and foreclosed properties into productive use.
“Why would we want to impose taxes on an entity that is trying to improve a subpar property and put it back onto the tax rolls? That would only further encumber the agency in its laudable mission, and I believe that is counter to the original legislative intent of the law,” Petrarca said.
“When the above-mentioned law passed, the legislative intent was to exempt land banks from all state and local taxes, including the realty transfer tax. However, the Revenue Department continues to assess this tax on certain transactions involving land banks. This legislation would correct that oversight.”
Petrarca said that land banks do good work in communities. For example, the Westmoreland County Land Bank actively pursues opportunities to return blighted properties to the tax rolls, with both commercial and housing developments. In fact, it became the first land bank in the commonwealth to sell a formerly vacant and blighted property to a new owner.
Recently, the Westmoreland County Land Bank acquired seven properties from a family estate and it plans to market the parcels as a multi-family housing complex for moderate income families in Latrobe.
“The assessment of taxes only hinders the ability to rehabilitate blighted properties, when we instead wish to facilitate their success,” Petrarca said. “I hope the legislature takes action to rectify this mistake.”
SOURCE: State Rep. Joseph Petrarca