PRINTER'S NO. 2497
No. 1855 Session of 2005
INTRODUCED BY McNAUGHTON, HERMAN, LESCOVITZ, BIANCUCCI, HANNA, ROSS, GINGRICH, HICKERNELL, HARHAI, HARPER, KAUFFMAN, T. STEVENSON, HENNESSEY, M. KELLER, PETRI, O'NEILL, DENLINGER, BALDWIN, DALLY, BOYD, GEIST, HARRIS, R. MILLER, HERSHEY, SCAVELLO, FRANKEL, McILHATTAN, WATSON, CAPPELLI, DeWEESE, ARMSTRONG AND PHILLIPS, JULY 3, 2005
REFERRED TO COMMITTEE ON LOCAL GOVERNMENT, JULY 3, 2005
AN ACT 1 Amending the act of June 24, 1931 (P.L.1206, No.331), entitled 2 "An act concerning townships of the first class; amending, 3 revising, consolidating, and changing the law relating 4 thereto," further providing for contracts and acquisition of 5 property and for general regulations concerning contracts. 6 The General Assembly of the Commonwealth of Pennsylvania 7 hereby enacts as follows: 8 Section 1. Section 1802(a) and (a.1) of the act of June 24, 9 1931 (P.L.1206, No.331), known as The First Class Township Code, 10 reenacted and amended May 27, 1949 (P.L.1955, No.569) and 11 amended or added July 10, 1990 (P.L.389, No.92) and December 20, 12 1996 (P.L.1495, No.192), are amended and the section is amended 13 by adding a subsection to read: 14 Section 1802. General Regulations Concerning Contracts.--(a) 15 All contracts or purchases made by any township, involving the 16 expenditure of over [ten thousand dollars] twenty-five thousand 17 dollars subject to annual adjustment under subsection (a.2),
1 except those hereinafter mentioned, shall not be made except 2 with and from the lowest responsible bidder, shall be in 3 writing, and shall be made only after notice by the secretary, 4 published, in one newspaper of general circulation, published or 5 circulating in the county in which the township is situated, at 6 least two times at intervals of not less than three days where 7 daily newspapers of general circulation are employed for such 8 publication, or in case weekly newspapers are employed then the 9 notice shall be published once a week for two successive weeks. 10 The first advertisement shall be published not more than forty- 11 five days and the second advertisement not less than ten days 12 prior to the date fixed for the opening of bids. Advertisements 13 for contracts or purchases shall also be posted in a conspicuous 14 place within the township. Advertisements for contracts or 15 purchases shall contain the date, time and location for opening 16 of bids and shall state the amount of the performance bond 17 determined under subsection (c). All plans and specifications 18 shall be on file at least ten days in advance of opening bids. 19 The amount of the contract shall in all cases, whether of 20 straight sale price, conditional sale, bailment lease, or 21 otherwise, be the entire amount which the township pays to the 22 successful bidder or his assigns in order to obtain the services 23 or property, or both, and shall not be construed to mean only 24 the amount which is paid to acquire title or to receive any 25 other particular benefit or benefits of the whole bargain. 26 (a.1) Written or telephonic price quotations from at least 27 three qualified and responsible contractors shall be requested 28 for all contracts that exceed [four thousand dollars] ten 29 thousand dollars subject to annual adjustment under subsection 30 (a.2) but are less than the amount requiring advertisement and 20050H1855B2497 - 2 -
1 competitive bidding or, in lieu of price quotations, a 2 memorandum shall be kept on file showing that fewer than three 3 qualified contractors exist in the market area within which it 4 is practicable to obtain quotations. A written record of 5 telephonic price quotations shall be made and shall contain at 6 least the date of the quotation, the name of the contractor and 7 the contractor's representative, the construction, 8 reconstruction, repair, maintenance or work which was the 9 subject of the quotation and the price. Written price 10 quotations, written records of telephonic price quotations and 11 memoranda shall be retained for a period of three years. 12 (a.2) (1) The Department of Labor and Industry shall 13 determine the percentage change in the Consumer Price Index for 14 All Urban Consumers for the twelve-month period ending September 15 30 of the calendar year in which this subsection becomes 16 effective, and for each successive twelve-month period 17 thereafter. 18 (2) The amount at which competitive bidding is required 19 under subsection (a) and the amount at which written or 20 telephonic price quotations are required under subsection (a.1) 21 shall be adjusted annually as follows: 22 (i) In the case of competitive bidding, the positive 23 percentage change, as determined in accordance with clause (1), 24 shall be multiplied by the amount applicable under subsection 25 (a) for the current year and the product thereof shall be added 26 to the amount applicable under subsection (a) for the current 27 year, with the result rounded to the nearest multiple of ten 28 dollars. 29 (ii) In the case of written or telephonic price quotations, 30 the positive percentage change, as determined in accordance with 20050H1855B2497 - 3 -
1 clause (1), shall be multiplied by the amount applicable under 2 subsection (a.1) for the current year and the product thereof 3 shall be added to the amount applicable under subsection (a.1) 4 for the current year, with the result rounded to the nearest 5 multiple of ten dollars. 6 (3) The annual determination required under clause (1) and 7 the calculation of the adjustments required under clause (2) 8 shall be made in the period between October 1 and November 15 of 9 the year following the effective date of this subsection, and 10 annually between October 1 and November 15 of each successive 11 year. 12 (4) The adjusted amounts obtained in accordance with clause 13 (2) shall become effective January 1 for the calendar year 14 following the year in which the determination required under 15 clause (1) is made. 16 (5) The Department of Labor and Industry shall give notice 17 in the Pennsylvania Bulletin prior to January 1 of each calendar 18 year of the annual percentage change determined in accordance 19 with clause (1) and the amounts, whether adjusted or unadjusted 20 in accordance with clause (2), at which competitive bidding is 21 required under subsection (a) and written or telephonic price 22 quotations are required under subsection (a.1) for the calendar 23 year beginning the first day of January after publication of the 24 notice. 25 * * * 26 Section 2. Section 1802.1 of the act, amended July 10, 1990 27 (P.L.389, No.92), is amended to read: 28 Section 1802.1. Evasion of Advertising Requirements.--(a) 29 No commissioner or commissioners shall evade the provisions of 30 section one thousand eight hundred two as to advertising for 20050H1855B2497 - 4 -
1 bids, by purchasing or contracting for services and personal 2 properties piecemeal for the purpose of obtaining prices under 3 [ten thousand dollars] twenty-five thousand dollars subject to 4 annual adjustment under section 1802(a.2) upon transactions, 5 which transactions should, in the exercise of reasonable 6 discretion and prudence, be conducted as one transaction 7 amounting to more than [ten thousand dollars] twenty-five 8 thousand dollars subject to annual adjustment under section 9 1802(a.2). This provision is intended to make unlawful the 10 evading of advertising requirements by making a series of 11 purchases or contracts each for less than the advertising 12 requirement price, or by making several simultaneous purchases 13 or contracts, each below said price, when in either case, the 14 transactions involved should have been made as one transaction 15 for one price. Any commissioners who so vote in violation of 16 this provision, and who know that the transaction upon which 17 they so vote is or ought to be a part of a larger transaction, 18 and that it is being divided in order to evade the requirements 19 as to advertising for bids, shall be jointly and severally 20 subject to surcharge for ten per centum of the full amount of 21 the contract or purchase. Whenever it shall appear that a 22 commissioner may have voted in violation of this section, but 23 the purchase or contract on which he so voted was not approved 24 by the board of commissioners, this section shall be 25 inapplicable. 26 (b) Any commissioner who votes to unlawfully evade the 27 provisions of section one thousand eight hundred two and who 28 knows that the transaction upon which he so votes is or ought to 29 be a part of a larger transaction and that it is being divided 30 in order to evade the requirements as to advertising for bids 20050H1855B2497 - 5 -
1 commits a misdemeanor of the third degree for each contract 2 entered into as a direct result of that vote. This penalty shall 3 be in addition to any surcharge which may be assessed pursuant 4 to subsection (a). 5 Section 3. This act shall apply to contracts and purchases 6 advertised on or after January 1 of the year following the 7 effective date of this section. 8 Section 4. This act shall take effect immediately. E19L73MSP/20050H1855B2497 - 6 -