THE GENERAL ASSEMBLY OF PENNSYLVANIA

SENATE BILL

INTRODUCED BY EICHELBERGER, KASUNIC, FOLMER, GORDNER, BOSCOLA, ORIE, RAFFERTY, YAW, M. WHITE, D. WHITE, ERICKSON, BAKER, ALLOWAY, BRUBAKER, GREENLEAF, SMUCKER, EARLL, WAUGH, FERLO, ROBBINS, VANCE, SCARNATI, McILHINNEY AND PICCOLA, JANUARY 26, 2011

REFERRED TO LOCAL GOVERNMENT, JANUARY 26, 2011  

AN ACT

Amending the act of June 24, 1931 (P.L.1206, No.331), entitled

"An act concerning townships of the first class; amending,

revising, consolidating, and changing the law relating

thereto," further providing for contracts and acquisition of

property and for general regulations concerning contracts.

The General Assembly of the Commonwealth of Pennsylvania

hereby enacts as follows:

Section 1.  Section 1802(a) and (a.1) of the act of June 24,

1931 (P.L.1206, No.331), known as The First Class Township Code,

reenacted and amended May 27, 1949 (P.L.1955, No.569) and

amended or added July 10, 1990 (P.L.389, No.92) and December 20,

1996 (P.L.1495, No.192), are amended and the section is amended

by adding a subsection to read:

Section 1802.  General Regulations Concerning Contracts.--(a)

All contracts or purchases made by any township, involving the

expenditure of over [ten thousand dollars] twenty-five thousand

dollars subject to adjustment under subsection (a.2), except

those hereinafter mentioned, shall not be made except with and

from the lowest responsible bidder, shall be in writing, and

shall be made only after notice by the secretary, published, in

one newspaper of general circulation, published or circulating

in the county in which the township is situated, at least two

times at intervals of not less than three days where daily

newspapers of general circulation are employed for such

publication, or in case weekly newspapers are employed then the

notice shall be published once a week for two successive weeks.

The first advertisement shall be published not more than forty-

five days and the second advertisement not less than ten days

prior to the date fixed for the opening of bids. Advertisements

for contracts or purchases shall also be posted in a conspicuous

place within the township. Advertisements for contracts or

purchases shall contain the date, time and location for opening

of bids and shall state the amount of the performance bond

determined under subsection (c). All plans and specifications

shall be on file at least ten days in advance of opening bids.

The amount of the contract shall in all cases, whether of

straight sale price, conditional sale, bailment lease, or

otherwise, be the entire amount which the township pays to the

successful bidder or his assigns in order to obtain the services

or property, or both, and shall not be construed to mean only

the amount which is paid to acquire title or to receive any

other particular benefit or benefits of the whole bargain.

(a.1)  Written or telephonic price quotations from at least

three qualified and responsible contractors shall be requested

for all contracts that exceed [four thousand dollars] seven

thousand dollars subject to adjustment under subsection (a.2) 

but are less than the amount requiring advertisement and

competitive bidding or, in lieu of price quotations, a

memorandum shall be kept on file showing that fewer than three

qualified contractors exist in the market area within which it

is practicable to obtain quotations. A written record of

telephonic price quotations shall be made and shall contain at

least the date of the quotation, the name of the contractor and

the contractor's representative, the construction,

reconstruction, repair, maintenance or work which was the

subject of the quotation and the price. Written price

quotations, written records of telephonic price quotations and

memoranda shall be retained for a period of three years.

(a.2)  (1)  Every five years, beginning with the year in

which this subsection becomes applicable to contracts and

purchases, the Department of Labor and Industry shall calculate

the average percentage change in the Consumer Price Index for

All Urban Consumers (CPI-U) for the United States city average

for all items as published by the United States Department of

Labor, Bureau of Labor Statistics, for the preceding five-year

period.

(2)  The amount at which competitive bidding is required

under subsection (a) and the amount at which written or

telephonic price quotations are required under subsection (a.1)

shall be adjusted every five years as follows:

(i)  In the case of competitive bidding, the positive

percentage change, as determined in accordance with clause (1),

shall be multiplied by the amount applicable under subsection

(a) for the current five-year period and the product thereof

shall be added to the amount applicable under subsection (a) for

the current five-year period, with the result rounded to the

nearest multiple of one hundred dollars.

(ii)  In the case of written or telephonic price quotations,

the positive percentage change, as determined in accordance with

clause (1), shall be multiplied by the amount applicable under

subsection (a.1) for the current five-year period and the

product thereof shall be added to the amount applicable under

subsection (a.1) for the current five-year period, with the

result rounded to the nearest multiple of one hundred dollars.

(3)  The determination required under clause (1) and the

calculation of the adjustments required under clause (2) shall

be made in the period between October 1 and November 15 of the

year following the effective date of this subsection, and

between October 1 and November 15 of each successive year.

(4)  The adjusted amounts obtained in accordance with clause

(2) shall become effective January 1 for the five-year period

following the year in which the determination required under

clause (1) is made.

(5)  The Department of Labor and Industry shall give notice

in the Pennsylvania Bulletin prior to January 1 of each calendar

year in which the annual percentage change determined in

accordance with clause (1) and the amounts, whether adjusted or

unadjusted in accordance with clause (2), at which competitive

bidding is required under subsection (a) and written or

telephonic price quotations are required under subsection (a.1)

for the five-year period beginning the first day of January

after publication of the notice.

* * *

Section 2.  Section 1802.1 of the act, amended July 10, 1990

(P.L.389, No.92), is amended to read:

Section 1802.1.  Evasion of Advertising Requirements.--(a)

No commissioner or commissioners shall evade the provisions of

section one thousand eight hundred two as to advertising for

bids, by purchasing or contracting for services and personal

properties piecemeal for the purpose of obtaining prices under

[ten thousand dollars] twenty-five thousand dollars subject to

adjustment under section 1802(a.2) upon transactions, which

transactions should, in the exercise of reasonable discretion

and prudence, be conducted as one transaction amounting to more

than [ten thousand dollars] twenty-five thousand dollars subject

to adjustment under section 1802(a.2). This provision is

intended to make unlawful the evading of advertising

requirements by making a series of purchases or contracts each

for less than the advertising requirement price, or by making

several simultaneous purchases or contracts, each below said

price, when in either case, the transactions involved should

have been made as one transaction for one price. Any

commissioners who so vote in violation of this provision, and

who know that the transaction upon which they so vote is or

ought to be a part of a larger transaction, and that it is being

divided in order to evade the requirements as to advertising for

bids, shall be jointly and severally subject to surcharge for

ten per centum of the full amount of the contract or purchase.

Whenever it shall appear that a commissioner may have voted in

violation of this section, but the purchase or contract on which

he so voted was not approved by the board of commissioners, this

section shall be inapplicable.

(b)  Any commissioner who votes to unlawfully evade the

provisions of section one thousand eight hundred two and who

knows that the transaction upon which he so votes is or ought to

be a part of a larger transaction and that it is being divided

in order to evade the requirements as to advertising for bids

commits a misdemeanor of the third degree for each contract

entered into as a direct result of that vote. This penalty shall

be in addition to any surcharge which may be assessed pursuant

to subsection (a).

Section 3.  This act shall apply to contracts and purchases

advertised on or after January 1 of the year following the

effective date of this section.

Section 4.  This act shall take effect immediately.