Section 6926.505 - State property tax reduction allocation(a)Administration.--The department shall do all of the following: (1) Array the 2002 personal income valuation divided by the 2003-2004 average daily membership, the 2004-2005 market value/income aid ratio, the 2002-2003 equalized millage and the 2002-2003 school tax ratio of each school district in rank order and assign each school district a discreet numerical rank for its personal income valuation per average daily membership, its market value/income aid ratio, its equalized millage and its school tax ratio. For the numerical rank of a school district's personal income valuation per average daily membership, the school district with the lowest personal income valuation per average daily membership shall have the highest numerical rank. For the numerical rank of a school district's market value/ income aid ratio, the school district with the highest market value/income aid ratio shall have the highest numerical rank, provided that all school districts with a market value/income aid ratio equal to 0.15 shall receive a ranking of 1. For the numerical rank of a school district's equalized millage, the school district with the highest equalized millage shall have the highest numerical rank. For the numerical rank of a school district's school tax ratio, the school district with the highest school tax ratio shall have the highest numerical rank.(2) Assign each school district a property tax reduction index.(3) If the department receives authorization under section 503(d), allocate the property tax reduction for each school district as follows:(i) Calculate the property tax reduction allocation as follows: (A) Multiply the school district's 2003-2004 average daily membership by the school district's property tax reduction index.(B) Multiply the product under clause (A) by the dollar amount necessary to allocate all of the money available for distribution under section 503(e). If the amount for distribution under section 503(e) is less than $750,000,000, the dollar amount shall be the dollar amount necessary to allocate $750,000,000.(C) If applicable, provide for the allocation minimum or allocation maximum under subparagraph (ii) or (iii).(ii) If the sum of the allocation under this paragraph and the estimated local revenue calculation certified under section 503(b) is less than the product of the residential property taxes collected during the 2001-2002 fiscal year and the allocation minimum for a school district, the school district shall receive an additional amount so that the sum of the total allocation under this paragraph and the estimated local revenue calculation certified under section 503(b) is equal to the product of the residential property taxes collected during the 2001-2002 fiscal year and the allocation minimum.(iii) Except as set forth in subsection (c), if the sum of the total allocation under this paragraph and the estimated local revenue calculation certified under section 503(b) is greater than the product of the residential property taxes collected during the 2001-2002 fiscal year and the allocation maximum for a school district, the school district shall receive a total allocation such that the sum of the total allocation and the estimated local revenue calculation certified under section 503(b) is equal to the product of the residential property taxes collected during the 2001-2002 fiscal year and the allocation maximum.(iv) If the amount for distribution under section 503(e) is less than $ 750,000,000, each school district shall receive a pro rata share of the property tax reduction allocation calculated under this paragraph at $750,000, 000.(4) Notify each school district of the amount of its property tax reduction allocation no later than May 1 of each year.(b)Payment.--For the fiscal year commencing July 1, 2006, and July 1 of each fiscal year thereafter, except as set forth in subsection (c), the department shall pay to each eligible school district a property tax reduction allocation equal to the amount calculated under subsection (a)(3). The property tax reduction allocation shall be divided into two equal payments, which shall be made on the fourth Thursday of August and the fourth Thursday of October. Each school district shall be eligible to receive a property tax reduction allocation under this section unless its board of school directors takes action under section 903.(c)First class school districts.--The property tax reduction allocation for a school district of the first class shall be paid by the department to a city of the first class. The limitations set forth in subsection (a)(3)(iii) shall not apply to the calculation of the property tax reduction allocation for a school district of the first class.(d)Reduction of wage taxes in a city of the first class.--A city council of a city of the first class shall reduce any tax imposed on the wages of residents and nonresidents under the authority of the act of August 5, 1932 (Sp.Sess., P.L. 45, No. 45), referred to as the Sterling Act, in a manner consistent with Chapter 7 and in accordance with the following: (1) For residents, by an amount equal to the amount of the property tax reduction allocation received from the Commonwealth pursuant to subsection (b) in an amount not to exceed the limitations set forth in subsection (a)(3)(iii) had such limitations applied.(2) For nonresidents, by any amount equal to the amount of the property tax reduction allocation received from the Commonwealth pursuant to subsection (b) in excess of the limitations set forth in subsection (a)(3)(iii) had such limitations applied.(3) If the amount for distribution under section 503(e) is less than $750,000,000, the tax reductions under paragraphs (1) and (2) shall be a pro rata share of the property tax reduction allocation to a school district of the first class calculated under subsection (a) at $750,000,000. 2006, June 27, P.L. 1873, No. 1(Spec. Sess. No. 1), § 505, imd. effective.