PRIOR PRINTER'S NO. 2497 PRINTER'S NO. 3242
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
AS REPORTED FROM COMMITTEE ON LOCAL GOVERNMENT, HOUSE OF
REPRESENTATIVES, AS AMENDED, DECEMBER 6, 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 EIGHTEEN <--
17 thousand dollars subject to annual adjustment under subsection
1 (a.2), except those hereinafter mentioned, shall not be made
2 except 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 SEVEN <--
29 thousand dollars subject to annual adjustment under subsection
30 (a.2) but are less than the amount requiring advertisement and
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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 (A.2) (1) ANNUALLY, BEGINNING WITH THE YEAR IN WHICH THIS <--
19 SUBSECTION BECOMES APPLICABLE TO CONTRACTS AND PURCHASES, THE
20 DEPARTMENT OF LABOR AND INDUSTRY SHALL CALCULATE THE PERCENTAGE
21 CHANGE IN THE CONSUMER PRICE INDEX FOR ALL URBAN CONSUMERS (CPI-
22 U) FOR THE UNITED STATES CITY AVERAGE FOR ALL ITEMS AS PUBLISHED
23 BY THE UNITED STATES DEPARTMENT OF LABOR, BUREAU OF LABOR
24 STATISTICS, FOR THE TWELVE-MONTH AVERAGE ENDING IN SEPTEMBER OF
25 THE PRIOR YEAR.
26 (2) The amount at which competitive bidding is required
27 under subsection (a) and the amount at which written or
28 telephonic price quotations are required under subsection (a.1)
29 shall be adjusted annually as follows:
30 (i) In the case of competitive bidding, the positive
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1 percentage change, as determined in accordance with clause (1),
2 shall be multiplied by the amount applicable under subsection
3 (a) for the current year and the product thereof shall be added
4 to the amount applicable under subsection (a) for the current
5 year, with the result rounded to the nearest multiple of ten
6 dollars.
7 (ii) In the case of written or telephonic price quotations,
8 the positive percentage change, as determined in accordance with
9 clause (1), shall be multiplied by the amount applicable under
10 subsection (a.1) for the current year and the product thereof
11 shall be added to the amount applicable under subsection (a.1)
12 for the current year, with the result rounded to the nearest
13 multiple of ten dollars.
14 (3) The annual determination required under clause (1) and
15 the calculation of the adjustments required under clause (2)
16 shall be made in the period between October 1 and November 15 of
17 the year following the effective date of this subsection, and
18 annually between October 1 and November 15 of each successive
19 year.
20 (4) The adjusted amounts obtained in accordance with clause
21 (2) shall become effective January 1 for the calendar year
22 following the year in which the determination required under
23 clause (1) is made.
24 (5) The Department of Labor and Industry shall give notice
25 in the Pennsylvania Bulletin prior to January 1 of each calendar
26 year of the annual percentage change determined in accordance
27 with clause (1) and the amounts, whether adjusted or unadjusted
28 in accordance with clause (2), at which competitive bidding is
29 required under subsection (a) and written or telephonic price
30 quotations are required under subsection (a.1) for the calendar
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1 year beginning the first day of January after publication of the
2 notice.
3 * * *
4 Section 2. Section 1802.1 of the act, amended July 10, 1990
5 (P.L.389, No.92), is amended to read:
6 Section 1802.1. Evasion of Advertising Requirements.--(a)
7 No commissioner or commissioners shall evade the provisions of
8 section one thousand eight hundred two as to advertising for
9 bids, by purchasing or contracting for services and personal
10 properties piecemeal for the purpose of obtaining prices under
11 [ten thousand dollars] twenty-five EIGHTEEN thousand dollars <--
12 subject to annual adjustment under section 1802(a.2) upon
13 transactions, which transactions should, in the exercise of
14 reasonable discretion and prudence, be conducted as one
15 transaction amounting to more than [ten thousand dollars]
16 twenty-five EIGHTEEN thousand dollars subject to annual <--
17 adjustment under section 1802(a.2). This provision is intended
18 to make unlawful the evading of advertising requirements by
19 making a series of purchases or contracts each for less than the
20 advertising requirement price, or by making several simultaneous
21 purchases or contracts, each below said price, when in either
22 case, the transactions involved should have been made as one
23 transaction for one price. Any commissioners who so vote in
24 violation of this provision, and who know that the transaction
25 upon which they so vote is or ought to be a part of a larger
26 transaction, and that it is being divided in order to evade the
27 requirements as to advertising for bids, shall be jointly and
28 severally subject to surcharge for ten per centum of the full
29 amount of the contract or purchase. Whenever it shall appear
30 that a commissioner may have voted in violation of this section,
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1 but the purchase or contract on which he so voted was not
2 approved by the board of commissioners, this section shall be
3 inapplicable.
4 (b) Any commissioner who votes to unlawfully evade the
5 provisions of section one thousand eight hundred two and who
6 knows that the transaction upon which he so votes is or ought to
7 be a part of a larger transaction and that it is being divided
8 in order to evade the requirements as to advertising for bids
9 commits a misdemeanor of the third degree for each contract
10 entered into as a direct result of that vote. This penalty shall
11 be in addition to any surcharge which may be assessed pursuant
12 to subsection (a).
13 Section 3. This act shall apply to contracts and purchases
14 advertised on or after January 1 of the year following the
15 effective date of this section.
16 Section 4. This act shall take effect immediately.
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