(a) Each local taxing authority may, by ordinance or resolution, exempt from all real property taxation the assessed valuation of any residential construction built in a deteriorating area from and after the effective date of this article in the amounts and in accordance with the schedule and limitations hereinafter provided. Prior to the adoption of the ordinance or resolution authorizing the granting of such exemptions from taxation, an interested municipal governing body shall determine the boundaries of deteriorating areas, wholly or partially located within its jurisdiction. At least one public hearing shall be held by the municipal governing body for the purposes of delineating said boundaries. At the public hearings any local taxing authority, planning commission or redevelopment authority and other public and private agencies and individuals, knowledgeable and interested in the improvement of deteriorating areas, shall present their recommendations concerning the location of boundaries of a deteriorating area or areas for the guidance of the municipal governing bodies, such recommendations to take into account not only the standards set forth in section 301, but also those set forth in the act of May 24, 1945 (P.L. 991, No. 385),¹ known as the “Urban Redevelopment Law,” for the determination of “blighted areas,” and the act of November 29, 1967 (P.L. 636, No. 292),² known as the “Neighborhood Assistance Act,” for the determination of “impoverished areas.” The ordinance or resolution shall specify a description of each such areas as determined by the municipal governing body, the maximum assessment per dwelling unit which may be exempted, and the schedule of taxes exempted as hereinafter provided.

(b) Two or more municipal governing bodies may join for the purpose of determining the boundaries of a deteriorating area and to establish the maximum cost per dwelling unit, and such municipal governing bodies shall cooperate fully with each other for the purpose of implementing this article. The local taxing authorities may, by implementing ordinance or resolution, agree to adopt tax exemptions contingent upon the similar adoption by an adjacent or coterminous local taxing authority, within the limitations provided herein.

(c) An area can be established as being deteriorating and decayed even though the area so designated is not a slum consisting exclusively of tangible physical blight. Any such deteriorating area may include buildings or improvements not in themselves blighted or dilapidated.