Two bills impacting Redevelopment Assistance Capital Projects (RACP) were recently enacted. House Bill 493 (Gabler, R-Clearfield) was signed by the governor on October 25 and is now Act 77 of 2013, and Senate Bill 680 (Corman, R-Centre) was signed on November 1 and is now Act 85 of 2013.

Act 77 reduces the Redevelopment Assistance Capital Program (RACP) debt ceiling and increases accountability of the project approval process. The legislative changes took effect immediately, including the reduction of the RACP debt ceiling by $600 million, from $4.05 billion to $3.45 billion.  This means fewer dollars available and potentially fewer projects approved through the program.

RACP is a grant program administered by the Budget Office for the acquisition and construction of regional economic, cultural, civic and historical improvement projects.  The funding may be used for the design and construction of facilities, which generate substantial increases in employment, tax revenues or other measures of economic activity in local communities.

In addition to the debt ceiling decrease, other major changes made by Act 77 include:

  • Restricting RACP funding to projects itemized in a capital project budget itemization bill, a capital budget bill or a capital project itemization bill enacted within 10 years of the date the project is approved;
  • Inclusion of a “community asset project” in the definition of RACP (a “community asset project” is defined as “a project which provides significant benefit or improvement to a community,” and includes “a cultural, recreational and historical project and any other project of civic significance”);
  • Inclusion in the definition of RACP of housing projects that will support and generate economic activity and are part of a community revitalization plan;
  • Clarification that storm water projects are an allowable part of infrastructure associated with economic development projects;
  • Increasing the amount of outstanding RACP debt for housing units by $25 million;
  • Requiring the Budget Office to establish guidelines for administration and approval of RACP within 60 days (i.e. by December 24, 2013); and
  • Mandating a 30-day public comment period prior to approval of an RACP application by the Budget Office.

Act 85 contains capital project itemizations/authorizations for various categories of capital projects, including RACP. A project must first be statutorily itemized/authorized before being considered for funding. Act 85 is the capital projects itemization act F.Y. 2013 -2014.

For questions about Act 77, Act 85 or additional information about RACP, please contact one of Buchanan’s State Government Relations attorneys or professionals.