PRIOR PRINTER'S NOS. 814, 1659, 2225, PRINTER'S NO. 2541
2376
No. 750 Session of 1989
INTRODUCED BY STOUT, CORMAN, STEWART, BRIGHTBILL, PUNT, LEMMOND,
PORTERFIELD, MADIGAN, AFFLERBACH, REIBMAN AND PETERSON,
MARCH 23, 1989
SENATE AMENDMENTS TO HOUSE AMENDMENTS, OCTOBER 1, 1990
AN ACT
1 Amending the act of May 2, 1945 (P.L.382, No.164), entitled "An
2 act providing for the incorporation as bodies corporate and
3 politic of 'Authorities' for municipalities, counties and
4 townships; prescribing the rights, powers and duties of such
5 Authorities heretofore or hereafter incorporated; authorizing
6 such Authorities to acquire, construct, improve, maintain and
7 operate projects, and to borrow money and issue bonds
8 therefor; providing for the payment of such bonds, and
9 prescribing the rights of the holders thereof; conferring the
10 right of eminent domain on such Authorities; authorizing such
11 Authorities to enter into contracts with and to accept grants
12 from the Federal Government or any agency thereof; and
13 conferring exclusive jurisdiction on certain courts over
14 rates," further defining "project" and "local government <--
15 unit"; adding a definition for "working capital"; further
16 providing for the general powers and duties of an authority;
17 further providing for removal of members; further providing <--
18 for contract procedures, purchases and advertising for bids;
19 and providing a penalty.
20 The General Assembly of the Commonwealth of Pennsylvania
21 hereby enacts as follows:
22 Section 1. Section 2(j) and (p) of the act of May 2, 1945 <--
23 (P.L.382, No.164), known as the Municipality Authorities Act of
24 1945, amended or added June 22, 1990 (P.L.236, No.54), are IS <--
25 amended and the section is amended by adding a clause to read:
1 Section 2. Definitions.--The following terms whenever used
2 or referred to in this act shall have the following meanings,
3 except in those instances where the context clearly indicates
4 otherwise:
5 * * *
6 (j) The term "project" shall mean equipment to be leased by
7 an Authority to the municipality or municipalities that
8 organized it or to any municipality or school district located
9 wholly or partially within the boundaries of the municipality or
10 municipalities that organized it, or any structure, facility or
11 undertaking which an Authority is authorized to acquire,
12 construct, finance, improve, maintain or operate, or provide
13 financing for insurance reserves under the provisions of this
14 act, or any working capital which an authority is authorized to
15 finance under the provisions of this act.
16 * * *
17 (p) The term "local government unit" shall have the same <--
18 meaning as that provided in section 102(c)(10) of the act of
19 July 12, 1972 (P.L.781, No.185), known as the "Local Government
20 Unit Debt Act[."]," except that the term shall also include a
21 city or county of the first class.
22 * * *
23 (r) The term "working capital" shall mean and include, but
24 shall not be limited to, funds for supplies, materials,
25 services, salaries, pensions and any other proper operating
26 expenses; provided that "working capital" shall be limited
27 solely to hospitals and health centers, and private, nonprofit,
28 nonsectarian colleges and universities, State-related
29 universities and community colleges, which are determined by the
30 Authority to be eligible educational institutions. Nothing
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1 herein shall prohibit the borrowing of working capital as may be
2 necessary or incidental to the undertaking or placing in
3 operation of any project undertaken in whole or in part pursuant
4 to this act.
5 Section 2. The introductory paragraph of clause (a) and
6 clause (b)(2)(v) of subsection A of section 4 of the act,
7 amended June 22, 1990 (P.L.236, No.54), are amended and clause
8 (b)(2) is amended by adding a subclause to read:
9 Section 4. Purposes and Powers; General.--A. Every
10 Authority incorporated under this act shall be a body corporate
11 and politic, and shall be for the purpose of acquiring, holding,
12 constructing, improving, maintaining, and operating, owning,
13 leasing, either in the capacity of lessor or lessee, projects of
14 the following kind and character and providing financing for
15 insurance reserves.
16 (a) The Authority shall be for the purpose of financing
17 working capital and of acquiring, holding, constructing,
18 financing, improving, maintaining and operating, owning,
19 leasing, either in the capacity of lessor or lessee, projects of
20 the kind and character described in the following subclauses and
21 for the purpose of providing financing for insurance reserves:
22 * * *
23 (b) This section is subject to the following limitations:
24 * * *
25 (2) The purpose and intent of this act being to benefit the
26 people of the Commonwealth by, among other things, increasing
27 their commerce, health, safety and prosperity, and not to
28 unnecessarily burden or interfere with existing business by the
29 establishment of competitive enterprises, none of the powers
30 granted by this act shall be exercised in the construction,
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1 financing, improvement, maintenance, extension or operation of
2 any project or projects or providing financing for insurance
3 reserves which in whole or in part shall duplicate or compete
4 with existing enterprises serving substantially the same
5 purposes. This limitation shall not apply to the exercise of the
6 powers granted hereunder:
7 * * *
8 (v) to provide financing for insurance reserves, if each
9 municipality or Authority intending to use any proceeds thereof
10 shall declare by resolution or ordinance that it is desirable
11 for the health, safety and welfare of the people in such local
12 government unit or served by such Authority[.]; nor
13 (vi) to projects for financing working capital.
14 * * *
15 Section 3. Subsection B of section 7 of the act, amended <--
16 July 27, 1953 (P.L.639, No.185), is amended to read:
17 Section 7. Governing Body.--* * *
18 B. Members shall hold office until their successors have
19 been appointed, and may succeed themselves, and, except members
20 of the boards of Authorities organized or created by a school
21 district or school districts, shall receive such salaries as may
22 be determined by the governing body or bodies of the
23 municipality or municipalities, but none of such salaries shall
24 be increased or diminished by such governing body or bodies
25 during the term for which the member receiving the same shall
26 have been appointed. Members of the board of any Authority
27 organized or created by a school district or school districts
28 shall receive no compensation for their services, but the
29 members of such board in office on the effective date of this
30 amendment shall continue to receive their salaries during the
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1 remainder of their existing term. A member may be removed [for
2 cause by the court of quarter sessions of the county in which
3 the Authority is located after having been provided with a copy
4 of the charges against him for at least ten days and full
5 hearing by the court.] by the governing body that appointed the
6 member. The governing body shall give the member at least ten
7 days notice of the intention to remove, prior to the removal
8 vote, and shall conduct a public hearing if requested by the
9 member. If a vacancy shall occur by reason of the death,
10 disqualification, resignation or removal of a member, the
11 municipal authorities shall appoint a successor to fill his
12 unexpired term. In joint Authorities such vacancies shall be
13 filled by the municipal Authorities of the municipality in the
14 representation of which the vacancy occurs. Whenever any
15 municipality shall withdraw from a joint Authority the term of
16 any member or members appointed from such municipality shall
17 immediately terminate.
18 * * *
19 Section 4 3. Section 10 of the act, amended or added June <--
20 28, 1979 (P.L.53, No.22) and February 18, 1982 (P.L.86, No.31),
21 is amended to read:
22 Section 10. Competition in Award of Contracts.--A. All
23 construction, reconstruction, repairs or work of any nature made
24 by any Authority, where the entire cost, value or amount of such
25 construction, reconstruction, repairs or work, including labor
26 and materials, shall exceed [four thousand dollars ($4,000)] ten
27 thousand dollars ($10,000), except construction, reconstruction,
28 repairs or work done by employes of said Authority, or by labor
29 supplied under agreement with any Federal or State agency, with
30 supplies and materials purchased as hereinafter provided, shall
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1 be done only under contract or contracts to be entered into by
2 the Authority with the lowest responsible bidder upon proper
3 terms, after due public notice has been given asking for
4 competitive bids as hereinafter provided. No contract shall be
5 entered into for construction or improvement or repair of any
6 project or portion thereof, unless the contractor shall give an
7 undertaking with a sufficient surety or sureties approved by the
8 Authority, and in an amount fixed by the Authority, for the
9 faithful performance of the contract. All such contracts shall
10 provide among other things that the person or corporation
11 entering into such contract with the Authority will pay for all
12 materials furnished and services rendered for the performance of
13 the contract, and that any person or corporation furnishing such
14 materials or rendering such services may maintain an action to
15 recover for the same against the obligor in the undertaking, as
16 though such person or corporation was named therein, provided
17 the action is brought within one year after the time the cause
18 of action accrued. Nothing in this section shall be construed to
19 limit the power of the Authority to construct, repair or improve
20 any project or portion thereof, or any addition, betterment or
21 extension thereto, directly by the officers, agents and employes
22 of the Authority, or otherwise than by contract.
23 B. All supplies and materials costing [four thousand dollars
24 ($4,000)] ten thousand dollars ($10,000), or more, shall be
25 purchased only after due advertisement as hereinafter provided.
26 Authority shall accept the lowest bid or bids, kind, quality and
27 material being equal, but the Authority shall have the right to
28 reject any or all bids or select a single item from any bid. The
29 provisions as to bidding shall not apply to the purchase of
30 patented and manufactured products offered for sale in a
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1 noncompetitive market or solely by a manufacturer's authorized
2 dealer.
3 B.1 Written or telephonic price quotations from at least
4 three qualified and responsible contractors shall be requested
5 for all contracts that exceed four thousand dollars ($4,000) but
6 are less than the amount requiring advertisement and competitive
7 bidding or, in lieu of price quotations, a memorandum shall be
8 kept on file showing that fewer than three qualified contractors
9 exist in the market area within which it is practicable to
10 obtain quotations. A written record of telephonic price
11 quotations shall be made and shall contain at least the date of
12 the quotation, the name of the contractor and the contractor's
13 representative, the construction, reconstruction, repair,
14 maintenance or work which was the subject of the quotation and
15 the price. Written price quotations, written records of
16 telephonic price quotations and memoranda shall be retained for
17 a period of three years.
18 C. The terms advertisement or due public notice wherever
19 used in this section, shall mean a notice published at least ten
20 (10) days before the award of any contract, in a newspaper of
21 general circulation published in the municipality where the
22 Authority has its principal office, and if no newspaper is
23 published therein then by publication in a newspaper in the
24 county where the Authority has its principal office: Provided,
25 That such notice may be waived where the Authority determines an
26 emergency exists, and such supplies and materials must be
27 immediately purchased by the said Authority.
28 D. No member of the Authority or officer or employe thereof
29 shall either directly or indirectly be a party to or be in any
30 manner interested in any contract or agreement with the
19890S0750B2541 - 7 -
1 Authority for any matter, cause or thing whatsoever by reason
2 whereof any liability or indebtedness shall in any way be
3 created against such Authority. If any contract or agreement
4 shall be made in violation of the provisions of this section the
5 same shall be null and void and no action shall be maintained
6 thereon against such Authority.
7 E. Subject to the aforesaid any Authority may (but without
8 intending by this provision to limit any powers of such
9 Authority) enter into and carry out such contracts, or establish
10 or comply with such rules and regulations concerning labor and
11 materials and other related matters in connection with any
12 project or portion thereof, as the Authority may deem desirable,
13 or as may be requested by any Federal agency that may assist in
14 the financing of such project or any part thereof: Provided,
15 however, That the provisions of this section shall not apply to
16 any case in which the Authority has taken over by transfer or
17 assignment any contract authorized to be assigned to it under
18 the provisions of section nine of this act, nor to any contract
19 in connection with the construction of any project which the
20 Authority may have had transferred to it by any person or
21 private corporation.
22 F. Every contract for the construction, reconstruction,
23 repair, improvement or maintenance of public works shall contain
24 a provision that any steel products used or supplied in the
25 performance of the contract or any subcontracts thereunder shall
26 be from steel made in the United States.
27 G. An Authority shall not evade the provisions of this
28 section as to bids or purchasing materials or contracting for
29 services piece-meal, for the purpose of obtaining prices under
30 ten thousand dollars ($10,000), upon transactions which should
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1 in the exercise of reasonable discretion and prudence be
2 conducted as one transaction amounting to more than ten thousand
3 dollars ($10,000). This provision is intended to make unlawful
4 the practice of evading contracting requirements by making a
5 series of purchases or contracts each for less than the
6 advertising requirement price, or by making several simultaneous
7 purchases or contracts each below said price, when in either
8 case the transaction involved should have been made as one
9 transaction for one price.
10 H. Any Authority member who votes to unlawfully evade the
11 provisions of this section and who knows that the transaction
12 upon which he so votes is or ought to be part of a larger
13 transaction and that it is being divided in order to evade the
14 requirements as to advertising for bids, commits a misdemeanor
15 of the third degree for each contract entered into as a direct
16 result of that vote.
17 Section 5 4. This act shall take effect in 60 days. <--
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