PRINTER'S NO. 565
No. 541 Session of 1999
INTRODUCED BY TANGRETTI, GORDNER, GEORGE, MARKOSEK, READSHAW, BELFANTI, SCRIMENTI, NAILOR, FAIRCHILD, WOJNAROSKI, WILT, HALUSKA, LAUGHLIN, CORRIGAN, MAYERNIK, CURRY, SHANER, WALKO, PESCI, SURRA, TRELLO, STURLA, STABACK, COLAFELLA, ARGALL, MICOZZIE, CASORIO, VAN HORNE, J. TAYLOR, TIGUE, GIGLIOTTI, SANTONI, MELIO, RAMOS, CAPPABIANCA, McCALL, MUNDY, SEYFERT, SOLOBAY, M. COHEN, L. I. COHEN, GRUCELA, ORIE, SCHRODER, SAINATO, JAMES, FREEMAN, BELARDI, YOUNGBLOOD, BUNT, STEELMAN, PETRARCA, KAISER, CIVERA, HARHAI AND STETLER, FEBRUARY 10, 1999
REFERRED TO COMMITTEE ON VETERANS AFFAIRS AND EMERGENCY PREPAREDNESS, FEBRUARY 10, 1999
AN ACT 1 Amending Title 53 (Municipalities Generally) of the Pennsylvania 2 Consolidated Statutes, providing for a loan program for local 3 police agencies funded by a bond issuance; establishing the 4 Police Agency Loan Division in the Pennsylvania Emergency 5 Management Agency; and conferring powers and duties on the 6 Secretary of the Commonwealth and the Legislative Reference 7 Bureau. 8 The General Assembly of the Commonwealth of Pennsylvania 9 hereby enacts as follows: 10 Section 1. Title 53 of the Pennsylvania Consolidated 11 Statutes is amended by adding a chapter to read: 12 CHAPTER 83 13 POLICE AGENCY LOANS 14 Subchapter 15 A. Preliminary Provisions 16 B. Administration
1 C. Loan Program 2 D. Debt 3 E. Miscellaneous Provisions 4 SUBCHAPTER A 5 PRELIMINARY PROVISIONS 6 Sec. 7 8301. Short title of chapter. 8 8302. Definitions. 9 § 8301. Short title of chapter. 10 This chapter shall be known and may be cited as the Police 11 Agency Loan Act. 12 § 8302. Definitions. 13 The following words and phrases when used in this chapter 14 shall have the meanings given to them in this section unless the 15 context clearly indicates otherwise: 16 "Agency." The Pennsylvania Emergency Management Agency. 17 "Division." The Police Agency Loan Division of the 18 Pennsylvania Emergency Management Agency established in section 19 8311 (relating to division). 20 "Fund." The Police Agency Loan Fund established in section 21 8312 (relating to fund). 22 "Police agency." A police department of a city, town, 23 township, borough or home rule municipality which: 24 (1) has police coverage for a minimum of 40 hours per 25 week; and 26 (2) has had, for the preceding 18 months, police 27 coverage for a minimum of 40 hours per week. 28 The term includes an office of county detectives working for a 29 district attorney and a regional police department organized 30 under the act of July 12, 1972 (P.L.762, No.180), referred to as 19990H0541B0565 - 2 -
1 the Intergovernmental Cooperation Law, or this title. 2 "Secretary." The Secretary of the Commonwealth. 3 "Sinking fund." The Police Agency Loan Sinking Fund 4 established in section 8337 (relating to sinking fund). 5 SUBCHAPTER B 6 ADMINISTRATION 7 Sec. 8 8311. Division. 9 8312. Fund. 10 § 8311. Division. 11 (a) Establishment.--The Police Agency Loan Division is 12 established as a division of the agency. 13 (b) Powers and duties.--The division has the following 14 powers and duties: 15 (1) To administer the fund as set forth in section 16 8312(c) (relating to fund). 17 (2) To administer Subchapter C (relating to loan 18 program). 19 (3) To collect loans made under section 8322(c) 20 (relating to loans). This paragraph includes the power to 21 institute actions for legal or equitable relief. 22 (4) To promulgate regulations to implement this chapter. 23 § 8312. Fund. 24 (a) Establishment.--The Police Agency Loan Fund is 25 established as a separate fund in the State Treasury. 26 (b) Source.--The following are the sources of the fund: 27 (1) The proceeds from the sale of bonds under section 28 8336 (relating to proceeds). 29 (2) The proceeds from the repayment of principal and 30 interest of loans under section 8322(c) (relating to loans). 19990H0541B0565 - 3 -
1 (c) Purpose.--The division shall administer the fund to do 2 all of the following: 3 (1) Repay the State Treasurer for the cost of the bond 4 issue under sections 8333 (relating to sale of bonds), 8334 5 (relating to refunding bonds) and 8335 (relating to 6 registration of bonds). 7 (2) Make loans under section 8322(c). 8 (3) Collect loans under section 8311(b)(3) (relating to 9 division). 10 (4) Administer this chapter. In any fiscal year, the 11 division may use for administrative costs 1% of the aggregate 12 debt authorized under section 8331 (relating to authority to 13 borrow). 14 SUBCHAPTER C 15 LOAN PROGRAM 16 Sec. 17 8321. Authority. 18 8322. Loans. 19 § 8321. Authority. 20 (a) Authorization.--The division may make a loan to a 21 political subdivision for a police agency of the political 22 subdivision as necessary for the proper performance of the 23 police agency's law enforcement duties, to do any of the 24 following: 25 (1) Purchase, expand, modernize or repair buildings or 26 portions of buildings which are used exclusively for police 27 purposes. This paragraph includes police headquarters, police 28 substations and police maintenance garages. 29 (2) Purchase, maintain or repair equipment. 30 (3) Purchase, maintain or repair vehicles. 19990H0541B0565 - 4 -
1 (b) Amount.--A loan under subsection (a) for the purchase, 2 maintenance or repair of buildings shall be for not less than 3 $5,000 nor more than $200,000. A loan under subsection (a) for 4 the purchase, maintenance or repair of vehicles or equipment 5 shall be for not less than $5,000 nor more than $100,000. No 6 political subdivision may receive loans totaling more than 7 $300,000 in a five-year period. 8 (c) Terms.-- 9 (1) A loan must be at an interest rate of 2%. 10 (2) A loan must be repaid in accordance with the 11 legislation applicable to the political subdivision which 12 receives the loan. 13 (3) A loan must have a repayment period as follows: 14 (i) For a loan of not more than $15,000, a period of 15 five years. 16 (ii) For a loan of more than $15,000 but not more 17 than $100,000, a period of ten years. 18 (iii) For a loan of more than $100,000, a period of 19 15 years. 20 § 8322. Loans. 21 (a) Application.--A political subdivision may apply for a 22 loan under section 8321 (relating to authority) by submitting to 23 the division all of the following: 24 (1) Name of police agency. 25 (2) Proposed use of loan. 26 (3) Need for use under paragraph (2). 27 (4) Documented ability to repay principal and interest 28 of loan. 29 (b) Determination.-- 30 (1) Within 60 days of receipt of an application under 19990H0541B0565 - 5 -
1 subsection (a), the division must make a decision and notify 2 the political subdivision of the decision. 3 (2) Failure to issue timely notice under paragraph (1) 4 shall be deemed a denial of the application. 5 (3) The provisions of 2 Pa.C.S. Ch. 7 Subch. A (relating 6 to judicial review of Commonwealth agency action) shall apply 7 to determinations under this subsection. 8 (c) Contracts.--Upon determination of eligibility under 9 subsection (b), the division shall enter into a loan contract 10 with the political subdivision. 11 SUBCHAPTER D 12 DEBT 13 Sec. 14 8331. Authority to borrow. 15 8332. Bonds. 16 8333. Sale of bonds. 17 8334. Refunding bonds. 18 8335. Registration of bonds. 19 8336. Proceeds. 20 8337. Sinking fund. 21 8338. Referendum. 22 § 8331. Authority to borrow. 23 Pursuant to section 7(a)(3) of Article VIII of the 24 Constitution of Pennsylvania and the referendum approved by the 25 electorate under section 8338 (relating to referendum), the 26 Governor, Auditor General and State Treasurer are authorized and 27 directed to borrow, on the credit of the Commonwealth, money not 28 exceeding in the aggregate the sum of $20,000,000 to implement 29 Subchapter C. 30 § 8332. Bonds. 19990H0541B0565 - 6 -
1 (a) General rule.--As evidence of the indebtedness 2 authorized under section 8331 (relating to authority to borrow), 3 general obligation bonds of the Commonwealth shall be issued. 4 The Governor, Auditor General and State Treasurer shall direct 5 for each bond the total amount; the form; the denomination; the 6 terms and conditions of issue, redemption and maturity; rate of 7 interest; and time of payment of interest. The latest stated 8 maturity date shall not exceed 30 years from the date of the 9 bond first issued for each series. 10 (b) Signature.--Bonds issued under subsection (a) shall bear 11 facsimile signatures of the Governor, Auditor General and State 12 Treasurer and a facsimile of the Great Seal of the Commonwealth 13 of Pennsylvania and shall be countersigned by two authorized 14 officers of the authorized loan and transfer agents of the 15 Commonwealth. 16 (c) Status.--Bonds issued under subsection (a) shall be 17 direct obligations of the Commonwealth, and the full faith and 18 credit of the Commonwealth are pledged for the payment of the 19 interest on the bonds as it becomes due and the payment of the 20 principal of the bonds at maturity. Bonds issued under 21 subsection (a) shall be exempt from taxation for State and local 22 purposes. The principal of and interest on such bonds shall be 23 payable in lawful money of the United States of America. 24 (d) Format.--Bonds issued under subsection (a) may be issued 25 as coupon bonds or registered as to both principal and interest 26 as the issuing officials may determine. If interest coupons are 27 attached, they shall contain the facsimile signature of the 28 State Treasurer. 29 (e) Amortization.--The issuing officials shall provide for 30 the amortization of the bonds in substantial and regular amounts 19990H0541B0565 - 7 -
1 over the term of the debt as follows: 2 (1) The first retirement of principal shall be stated to 3 mature prior to the expiration of a period of time equal to 4 one-tenth of the time from the date of the first obligation 5 issue to evidence the debt to the date of the expiration of 6 the term of the debt. 7 (2) Retirements of principal shall be regular and 8 substantial if made in annual or semiannual amounts, whether 9 by stated serial maturities or by mandatory sinking fund 10 retirements, computed either in accordance with a level 11 annual debt service plan, as nearly as may be, or upon the 12 equal annual maturities plan. 13 (f) Processing.--The Governor, the Auditor General and the 14 State Treasurer shall proceed to have the necessary bonds 15 prepared and printed. The bonds, as soon as they are prepared 16 and printed, shall be deposited with the authorized loan and 17 transfer agent of the Commonwealth, there to remain until sold 18 under section 8333 (relating to sale of bonds). 19 § 8333. Sale of bonds. 20 (a) Public sale.--Bonds issued under section 8332(a) 21 (relating to bonds) shall be offered for sale at not less than 22 98% of the principal amount and accrued interest and shall be 23 sold by the Governor, Auditor General and State Treasurer to the 24 highest and best bidder or bidders after public advertisement, 25 on terms and conditions and upon open competitive bidding, as 26 the Governor, Auditor General and State Treasurer shall direct. 27 (b) Private sale.--Any portion of a bond issue offered under 28 subsection (a) but not sold or subscribed for may be disposed of 29 by private sale by the Governor, Auditor General and State 30 Treasurer, in a manner and at a price not less than 98% of the 19990H0541B0565 - 8 -
1 principal amount and accrued interest, as the Governor shall 2 direct. No commission shall be allowed or paid for the sale of 3 bonds issued under section 8332(a). 4 (c) Series.--When bonds are issued, the bonds of each issue 5 shall constitute a separate series to be designated by the 6 issuing officials or may be combined for sale as one series with 7 other general obligation bonds of the Commonwealth. 8 § 8334. Refunding bonds. 9 The Governor, Auditor General and State Treasurer are 10 authorized to provide, by resolution, for the issuance of 11 refunding bonds for the purpose of refunding bonds issued under 12 section 8332(a) (relating to bonds) and outstanding, either by 13 voluntary exchange with the holders of the outstanding bonds or 14 by providing funds to redeem and retire the outstanding bonds 15 with accrued interest and premium payable on the bonds, at 16 maturity or at a call date. Refunding bonds may be issued by the 17 Governor, Auditor General and State Treasurer to refund bonds 18 previously issued under this section for refunding purposes. 19 Sections 8331 (relating to authority to borrow), 8332 (relating 20 to bonds) and 8333 (relating to sale of bonds) shall apply to 21 bonds under this section. 22 § 8335. Registration of bonds. 23 The Auditor General shall prepare the necessary registry book 24 to be kept in the office of the authorized loan and transfer 25 agent of the Commonwealth for the registration of bonds issued 26 under section 8332(a) (relating to bonds), at the request of 27 bond owners, according to the terms and conditions of issue 28 directed by the Governor, Auditor General and State Treasurer. 29 Bonds which are issued without interest coupons attached shall 30 be registered in the registry books kept by the authorized loan 19990H0541B0565 - 9 -
1 and transfer agent of the Commonwealth. 2 § 8336. Proceeds. 3 The proceeds realized from the sale of bonds under section 4 8332(a) (relating to bonds) shall be paid into the fund. The 5 money shall be paid by the State Treasurer into the fund. 6 § 8337. Sinking fund. 7 (a) Establishment.--The Police Agency Loan Sinking Fund is 8 established as a separate fund in the State Treasury. 9 (b) Source.-- 10 (1) By November 1, the State Treasurer shall notify the 11 Secretary of the Budget of the amount necessary for the 12 ensuing fiscal year to redeem, with interest, bonds issued 13 under section 8332(a) (relating to bonds). 14 (2) The General Assembly shall appropriate the amount of 15 money necessary to meet repayment obligations under paragraph 16 (1) for deposit into the Police Agency Sinking Loan Fund. 17 § 8338. Referendum. 18 (a) Question.-- 19 (1) The question of incurring indebtedness of 20 $20,000,000 for loans to police agencies for the purpose of 21 purchasing, maintaining and repairing buildings, equipment 22 and vehicles, as necessary for the proper performance of the 23 police agencies' law enforcement duties, shall be submitted 24 to the electors at the next primary, municipal or general 25 election following the effective date of this section. At 26 least three months prior to the election, the secretary must 27 publish the question in at least two newspapers of general 28 circulation in each county in which at least two newspapers 29 of general circulation are published. 30 (2) The secretary shall certify the question to the 19990H0541B0565 - 10 -
1 county boards of election to implement paragraph (1). 2 (b) Form.--The question shall be in substantially the 3 following form: 4 Do you favor the incurring of indebtedness of $20,000,000 5 for loans to police agencies for the purpose of purchasing, 6 maintaining and repairing buildings, equipment and vehicles, 7 as necessary for the proper performance of the police 8 agencies' law enforcement duties? 9 (c) Election.--The election shall be conducted in accordance 10 with the act of June 3, 1937 (P.L.1333, No.320), known as the 11 Pennsylvania Election Code, except that the time limits for 12 advertisement of notice of the election may be waived as to the 13 question. 14 (d) Notice.--If a majority of the electors voting in the 15 election under subsection (c) vote in the affirmative, the 16 secretary shall send notice of the vote to the Legislative 17 Reference Bureau for publication in the Pennsylvania Bulletin. 18 SUBCHAPTER E 19 MISCELLANEOUS PROVISIONS 20 Sec. 21 8341. Repeals. 22 § 8341. Repeals. 23 All acts and parts of acts are repealed insofar as they are 24 inconsistent with this chapter. 25 Section 2. This act shall take effect as follows: 26 (1) The addition of 53 Pa.C.S. § 8338 shall take effect 27 immediately. 28 (2) The remainder of this act shall take effect on the 29 date of publication of the notice under section 8338(d). A6L53RLE/19990H0541B0565 - 11 -