PRIOR PRINTER'S NOS. 1241, 1648 PRINTER'S NO. 1859
No. 1100 Session of 1987
INTRODUCED BY PIEVSKY, IRVIS, MANDERINO, KUKOVICH, STEIGHNER,
GEORGE, SALOOM, GRUITZA, HALUSKA, RYBAK, BROUJOS, BELARDI,
WAMBACH, MAIALE, CAPPABIANCA, VAN HORNE, STUBAN, COY,
LEVDANSKY, FEE, JOSEPHS, LaGROTTA, COWELL, DOMBROWSKI,
SEVENTY, KASUNIC, WOZNIAK, CALTAGIRONE, DeWEESE, DeLUCA,
RUDY, MRKONIC, OLASZ, D. R. WRIGHT, BUSH, BOYES, BELFANTI,
SHOWERS, STABACK, BALDWIN, DUFFY, TIGUE, BLAUM, McHALE,
LLOYD, MARKOSEK, SWEET, BORTNER, GAMBLE, LUCYK, MAINE, GEIST,
OLIVER, JAROLIN, KOSINSKI, COLE, MELIO, GRUPPO, DALEY,
O'DONNELL, ACOSTA, LINTON, ITKIN, CARN, MICHLOVIC, MILLER,
HAYDEN, S. H. SMITH, WOGAN, FREEMAN, F. TAYLOR, LIVENGOOD,
McCALL, LAUGHLIN, LESCOVITZ, COLAFELLA, YANDRISEVITS, VEON,
RIEGER, CORRIGAN, PRESSMANN, EVANS, MORRIS, PRESTON, FOX,
RITTER, PISTELLA AND BATTISTO, APRIL 21, 1987
AS AMENDED ON THIRD CONSIDERATION, HOUSE OF REPRESENTATIVES,
JUNE 16, 1987
AN ACT
1 Providing for the establishment, implementation and
2 administration of the Pennsylvania Infrastructure Investment
3 Authority; imposing powers and duties on a board of trustees;
4 transferring the rights, powers, duties and obligations of
5 the Water Facilities Loan Board to the Pennsylvania
6 Infrastructure Investment Authority; providing for the
7 issuance of notes and bonds; providing for financial
8 assistance and for a comprehensive water facilities plan; and
9 making repeals.
10 TABLE OF CONTENTS
11 Section 1. Short title.
12 Section 2. Legislative intent.
13 Section 3. Definitions.
14 Section 4. Pennsylvania Infrastructure Investment Authority;
15 board of directors.
1 Section 5. Revenues of authority.
2 Section 6. Powers and duties of authority.
3 Section 7. Specific power to issue bonds.
4 Section 8. Covenants and express conditions on obligations.
5 Section 9. Nature and effect of pledges.
6 Section 10. Financial assistance.
7 Section 11. Comprehensive water facilities plan.
8 Section 12. Audits.
9 Section 13. Annual report.
10 Section 14. Expedited approval of rate relief.
11 Section 15. Transfer of Water Facilities Loan Board.
12 Section 16. Repeals.
13 Section 17. Severability.
14 Section 18. Effective date.
15 The General Assembly of the Commonwealth of Pennsylvania
16 hereby enacts as follows:
17 Section 1. Short title.
18 This act shall be known and may be cited as the Pennsylvania
19 Infrastructure Investment Authority Act.
20 Section 2. Legislative intent.
21 The General Assembly finds and declares that:
22 (1) The health of millions of citizens of this
23 Commonwealth is at risk due to substandard and deteriorated
24 water supply and sewage disposal systems.
25 (2) Many water and sewage systems in this Commonwealth
26 are aging, outmoded, inadequate, deteriorating and operating
27 above capacity, and many areas have to limit their growth
28 solely due to lack of proper water supply and sewage
29 disposal.
30 (3) The economic revitalization of this Commonwealth is
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1 being stifled by a lack of clean water and adequate sewage
2 facilities.
3 (4) Financing of water and sewage projects at affordable
4 cost is not currently available in many areas of this
5 Commonwealth.
6 (5) In order to assist in financing projects to protect
7 the health and safety of the citizens of this Commonwealth
8 and to promote the economic development of Pennsylvania, the
9 General Assembly has determined that it is necessary to
10 establish the Pennsylvania Infrastructure Investment
11 Authority and to provide funding of the authority programs.
12 Section 3. Definitions.
13 The following words and phrases when used in this act shall
14 have the meanings given to them in this section unless the
15 context clearly indicates otherwise:
16 "Authority." The Pennsylvania Infrastructure Investment
17 Authority.
18 "Board." The board of directors of the authority.
19 "Bonds." Bonds, notes or other evidences of indebtedness
20 issued by the authority pursuant to this act.
21 "Eligible cost." The cost of all labor, materials, machinery
22 and equipment, lands, property, rights and easements, plans and
23 specifications, surveys or estimates of costs and revenues,
24 engineering and legal services, and all other expenses necessary
25 or incident to the acquisition, construction, improvement,
26 expansion, extension, repair or rehabilitation of all or part of
27 a project.
28 "Governmental unit." Any agency of the Commonwealth or any
29 county, municipality or school district, or any agency,
30 instrumentality, authority or corporation thereof, or any public
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1 body having local or regional jurisdiction or power.
2 "Partnership." The Pennsylvania Economic Development
3 Partnership established by the act of , 19 (P.L. ,
4 No. ).
5 "Project." The eligible costs associated with the
6 acquisition, construction, improvement, expansion, extension,
7 repair or rehabilitation of all or part of any facility or
8 system, whether publicly or privately owned, for the collection,
9 treatment or disposal of wastewater, including industrial waste,
10 or for the supply, TREATMENT, storage or distribution of <--
11 drinking water.
12 "Secretary." The Secretary of the Pennsylvania Economic
13 Development Partnership.
14 "Water Facilities Loan Board." The board established under
15 32 Pa.C.S. § 7504 (relating to Water Facilities Loan Board).
16 Section 4. Pennsylvania Infrastructure Investment Authority;
17 board of directors.
18 (a) Establishment.--There is hereby established a body
19 corporate and politic, with corporate succession, to be known as
20 the Pennsylvania Infrastructure Investment Authority. The
21 authority is constituted an instrumentality of the Commonwealth,
22 and the exercise by the authority of the powers conferred by
23 this act shall be deemed and held to be a public and essential
24 governmental function.
25 (b) Membership.--The authority shall consist of an 11-member
26 board of directors composed of the Governor, the majority and
27 minority leaders of the Senate, the majority and minority
28 leaders of the House of Representatives, the Secretary of the
29 Pennsylvania Economic Development Partnership, the Secretary of
30 Community Affairs, the Secretary of Environmental Resources, the
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1 Secretary of General Services, the Secretary of the Budget and
2 the Chairman of the Pennsylvania Public Utility Commission.
3 (c) Officers.--The Governor shall be the chairman and chief
4 executive officer of the authority. The board shall biannually
5 elect a vice-chairman. The board shall select a secretary and
6 treasurer who need not be members of the board, and the same
7 person may be selected to serve as both secretary and treasurer.
8 (d) Vesting of powers.--The powers of the authority shall be
9 vested in the board in office from time to time, and seven EIGHT <--
10 members of the board shall constitute a quorum at any meeting.
11 Action may be taken and motions and resolutions adopted by the
12 authority by the affirmative vote of at least seven members of
13 the board. No vacancy on the board shall impair the right of a
14 quorum of the members of the board to exercise the powers and
15 perform the duties of the authority.
16 (e) Designees.--Each member of the board may designate
17 someone to represent him at meetings of the board. Each designee
18 may lawfully vote and otherwise act on behalf of the member of
19 the board for whom he constitutes the designee. The designation
20 shall be in writing delivered to the authority and shall
21 continue in effect until revoked or amended in writing delivered
22 to the authority.
23 (f) Services.--Research, investigation and other services
24 necessary for the operation of the board shall be carried out
25 from resources and by employees from the various executive
26 departments represented on the board. All applicable
27 Commonwealth departments and agencies shall cooperate with, and
28 provide assistance to, the board, which may, at its discretion,
29 provide financial reimbursement.
30 (g) Dissolution.--The authority may be dissolved by law,
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1 provided that the authority has no bonds or other debts or
2 obligations outstanding or that provision has been made for the
3 payment or retirement of all such bonds, debts and obligations.
4 Upon any dissolution of the authority, all property, funds and
5 assets of the authority shall be vested in the Commonwealth.
6 Section 5. Revenues of authority.
7 (a) Sources of revenues.--The authority may receive money
8 from sources of revenue, including, but not limited to, the
9 following:
10 (1) State funds appropriated to the authority.
11 (2) Federal funds appropriated to or granted to the
12 authority.
13 (3) Proceeds from the sale of bonds of the authority
14 authorized under section 7.
15 (4) Proceeds from the sale of bonds issued on or after
16 the effective date of this act from the remaining unused
17 authorization from the act of July 12, 1981 (P.L.263, No.88),
18 entitled "An act authorizing the incurring of indebtedness,
19 with approval of the electors, of $300,000,000 for the
20 repair, construction, reconstruction, rehabilitation,
21 extension and improvement of community water supply systems,
22 and for the repair, reconstruction or rehabilitation of flood
23 control facilities, dams and port facilities and providing
24 the allotment of proceeds from borrowing hereunder," approved
25 by the electorate on November 3, 1981.
26 (5) Proceeds from the sale of bonds issued for site
27 development under the provisions of Article XVI-B of the act
28 of April 9, 1929 (P.L.343, No.176), known as The Fiscal Code.
29 (6) Proceeds from the sale of any other Commonwealth
30 general obligation bonds designated for the authority.
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1 (7) Proceeds from the sale of authority assets.
2 (8) Repayment of loan principal.
3 (9) Payment of interest on loans made by the authority.
4 (10) Interest earned on the investments of authority
5 moneys.
6 (b) Control of revenues; investment of funds.--The board
7 shall have exclusive control and management of all moneys of the
8 authority and full power to invest moneys not required for
9 immediate use in any securities or other investments in which
10 funds of the Commonwealth are authorized to be invested and in
11 any other type of security or investment if, prior to the
12 acquisition of the securities or investments, the board
13 determines by resolution that such type of security or
14 investment is in the best interests of the authority and the
15 State Treasurer approves of such type of security or other
16 investment.
17 (c) General fund and other separate funds or accounts.--The
18 board shall establish a general fund from which it may authorize
19 expenditures for any of the purposes of this act. The board may
20 also establish revolving funds and accounts and other separate
21 funds and accounts when separate accounting for different
22 sources of funds is required by State or Federal law or when
23 otherwise determined by the board to be necessary or convenient.
24 (d) Loan repayment.--Subject to any agreement with the
25 holders of bonds, repayments of loan principal, together with
26 any interest thereon, shall be deposited with the authority and
27 credited to such fund or account as the board shall determine.
28 Loans made by the Water Facilities Loan Board prior to the
29 effective date of this act and repayment of the principal of and
30 interest on those loans shall be controlled by the provisions of
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1 Title 32 of the Pennsylvania Consolidated Statutes (relating to
2 forests, waters and State parks) and the regulations promulgated
3 thereunder. The board shall maintain such separate funds and
4 accounts as may be necessary for the deposit of payments made
5 under authority or requirement of State or Federal law.
6 Section 6. Powers and duties of authority.
7 The authority shall have and may exercise all powers
8 necessary or appropriate to carry out and effectuate the
9 purposes of this act, including, but not limited to, the
10 following:
11 (1) Conduct examinations and investigations and take
12 testimony, under oath or affirmation, at public or private <--
13 hearings, on any matter necessary to the determination and
14 approval of project applications.
15 (2) Sue and be sued, implead and be impleaded, complain
16 and defend in all courts.
17 (3) Adopt, use and alter at will a corporate seal.
18 (4) Make bylaws for the management and regulation of its
19 affairs, and make and, from time to time, amend and repeal
20 rules and regulations governing the administrative procedures
21 and business of the authority.
22 (5) Make contracts of every name and nature and execute
23 all instruments necessary or convenient for the carrying on
24 of its business.
25 (6) Accept grants from and enter into contracts or other
26 transactions with any Federal, State or local agency.
27 (7) Take title by foreclosure or otherwise to any
28 project or other property pledged, mortgaged, encumbered or
29 otherwise available as security for a project financed in
30 whole or in part by the board, whether by loan, loan
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1 guarantee or otherwise, where such acquisition is necessary
2 to protect the interests of the board with respect to a
3 project; pay all costs arising out of such acquisition from
4 moneys held in the trust fund; and sell, transfer and convey
5 all or any portion of any such project to any responsible
6 buyer. The board may require a dedicated source of revenue to
7 be available for repayment of any loan.
8 (8) Provide financial assistance, including, but not
9 limited to, loans, loan guarantees, bond guarantees and
10 grants for projects fulfilling the purposes of this act.
11 (9) Collect fees and charges, as the board determines to
12 be reasonable, relating to activities undertaken in
13 furtherance of the purposes of this act.
14 (10) Borrow money and issue bonds and provide for the
15 right of holders thereof in accordance with the provisions of
16 this act.
17 (11) Pledge, hypothecate or otherwise encumber all or
18 any of the revenues or receipts of the authority as security
19 for all or any of the bonds of the authority.
20 (12) Receive appropriations and apply for and accept
21 grants, gifts, donations, bequests and settlements from any
22 public or private source.
23 (13) Acquire, own, hold, construct, improve,
24 rehabilitate, renovate, operate, maintain, sell, assign,
25 exchange, lease, mortgage or otherwise dispose of real and
26 personal property or any interest therein in the exercise of
27 its powers and the performance of its duties under this act.
28 (14) Procure insurance against any loss in connection
29 with its property and other assets and operations in any
30 amounts and from any insurers as it deems desirable.
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1 (15) Contract for the services of attorneys, accountants
2 and financial experts and any other advisors, consultants and
3 agents as may be necessary in its judgment, subject to the
4 requirement that the chairman shall ensure that minority-
5 owned or minority-controlled firms shall have an opportunity
6 to participate to a significant degree in the provision of
7 any contractual services purchased by the authority.
8 (16) Subject to any agreement with holders of its bonds,
9 notes or other obligations, purchase bonds, notes and other
10 obligations of the authority.
11 (17) Subject to any agreement with holders of its bonds,
12 notes or other obligations, obtain as security for payment of
13 all or any part of the principal of and interest and premium
14 on the bonds, notes and other obligations of the authority,
15 lines of credit and letters of credit in any amounts and upon
16 any terms as the authority may determine, and pay any fees
17 and expenses required in connection therewith.
18 (18) Do any act necessary or convenient to the exercise
19 of the powers enumerated in this section or reasonably
20 implied therefrom.
21 (19) Serve as the Water Facilities Loan Board to satisfy
22 any outstanding bond obligation and loan liabilities.
23 (20) Assume all the rights, powers, duties, obligations
24 and liabilities of the Water Facilities Loan Board.
25 (21) Repay the General Fund any or all debt service due
26 to be paid in any fiscal year from bonds used to fund
27 projects under this act.
28 (22) Prepare plans and reports and provide for public
29 participation as deemed appropriate.
30 Section 7. Specific power to issue bonds.
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1 (a) Principal amounts.--The authority may issue its bonds,
2 notes or other obligations in principal amounts as in the
3 judgment of the authority shall be necessary to provide
4 sufficient funds for any of its corporate purposes. Corporate
5 purposes shall be deemed to include:
6 (1) The payment, funding or refunding of the principal
7 of, or interest or redemption premiums on, any bonds issued
8 by it, whether the bonds to be funded or refunded have or
9 have not become due.
10 (2) The establishment or increase or reserves to secure
11 or to pay the bonds or interest thereon.
12 (3) All other costs or expenses of the authority
13 incident to and necessary to carry out its corporate purposes
14 and powers.
15 (b) Negotiable instrument designation.--Whether or not the
16 bonds are of a form and character as to be negotiable
17 instruments under the terms of Title 13 of the Pennsylvania
18 Consolidated Statutes (relating to commercial code), the bonds
19 are made negotiable instruments within the meaning of and for
20 the purposes of Title 13, subject only to the provisions of the
21 bonds for registration.
22 (c) Resolution; terms of bonds.--Bonds shall be authorized
23 by resolution of the board, may be issued in one or more series
24 and shall bear any date or dates, mature at any time or times
25 not later than 35 years from the date of issuance thereof, bear
26 interest at any rate or rates or at variable rates, be in any
27 denomination or denominations, be in any form, either coupon or
28 registered, carry any conversion or registration privileges,
29 have any rank or priority, be executed in any manner, be payable
30 from such sources in any medium of payment at any place or
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1 places within or without this Commonwealth, and be subject to
2 any terms of redemption, purchase or tender by the authority or
3 the holders thereof, with or without premium, as the resolution
4 or resolutions may provide. A resolution of the authority
5 authorizing the issuance of bonds may provide that the bonds be
6 secured by a trust indenture between the authority and a
7 trustee, vesting in the trustee any property, rights, powers and
8 duties in trust consistent with the provisions of this act as
9 the authority may determine. Such resolution may further provide
10 for the acquisition of credit enhancement devices such as bond
11 insurance, letters of credit or any other instruments to carry
12 out the provisions of this section.
13 (d) Public or private sale.--Bonds may be sold at public or
14 private sale at any price or prices and in any manner as the
15 authority may determine, subject to the requirement that the
16 chairman shall ensure that minority-owned or minority-controlled
17 firms shall have an opportunity to participate to a significant
18 degree in any bond sale activities.
19 (e) No prior preconditions on bond issuance.--Bonds may be
20 issued under the provisions of this act without obtaining the
21 consent of any department, division, board, bureau or agency of
22 the Commonwealth and without any other proceeding or the
23 happening of any other conditions or other things than those
24 proceedings, conditions or things which are specifically
25 required by this act.
26 (f) Limitation on obligations.--Bonds issued under the
27 provisions of this act shall not be a debt or liability of the
28 Commonwealth or of any of its political subdivisions other than
29 the authority and shall not create or constitute any
30 indebtedness, liability or obligation of the Commonwealth or of
19870H1100B1859 - 12 -
1 any political subdivision. All bonds shall be payable solely
2 from revenues or funds pledged or available for their payment as
3 authorized in this act, including the proceeds of any issue of
4 bonds. Each bond shall contain on its face a statement to the
5 effect that the authority is obligated to pay the principal
6 thereof or the interest thereon only from its revenues, receipts
7 or funds pledged or available for their payment as authorized in
8 this act, that neither the Commonwealth nor any political
9 subdivisions are obligated to pay the principal or interest, and
10 that neither the faith and credit nor the taxing power of the
11 Commonwealth or any political subdivision is pledged to the
12 payment of the principal of or the interest on the bonds.
13 (g) Nature of obligation and payment.--Each issue of bonds
14 may, if it is determined by the authority, be general
15 obligations of the authority payable out of any revenues,
16 receipts or funds of the authority, or special obligations
17 payable out of particular revenues, receipts or funds, subject
18 only to agreements with the holders of the bonds. Bonds may be
19 secured by one or more of the following:
20 (1) Pledges of revenues and other receipts to be derived
21 from the payment of the interest on and any principal of
22 notes and bonds issued by one or more governmental units and
23 purchased by the authority, and any other payment made to the
24 authority pursuant to agreements with any governmental unit
25 or a pledge or assignment of any notes and bonds of any
26 governmental units, and the rights and interests of the
27 authority therein.
28 (2) Pledges of loan payments, rentals, other revenues to
29 be derived from loan agreements, leases or other contractual
30 arrangements with any person or entity, public or private, or
19870H1100B1859 - 13 -
1 a pledge or assignment of any such loan agreements, leases or
2 other contractual arrangements, and the rights and interests
3 of the authority therein.
4 (3) Pledges of grants, subsidies, contributions,
5 appropriations or other payments to be received from the
6 Federal Government or any instrumentality thereof or from the
7 Commonwealth, any Commonwealth agency or other governmental
8 unit.
9 (4) Pledges of all moneys, funds, accounts, securities
10 and other funds, including the proceeds of the bonds.
11 (5) Mortgages and security interests covering all or
12 part of any project or other property of any person or
13 entity, real or personal, then owned or thereafter to be
14 acquired, or a pledge or assignment of mortgages and security
15 interests made or granted to the authority by any person or
16 entity, and the rights and interests of the authority
17 therein.
18 Section 8. Covenants and express conditions on obligations.
19 In any resolution of the authority authorizing or relating to
20 the issuance of bonds, the authority, in order to secure payment
21 of the bonds, and, in addition to its other powers, may, by
22 provisions in the resolution which shall constitute covenants by
23 the authority and contracts with the holders of the bonds, do
24 the following:
25 (1) Secure the bonds.
26 (2) Make covenants against pledging all or part of its
27 revenues or receipts to other parties.
28 (3) Make covenants limiting its right to sell, pledge or
29 otherwise dispose of notes and bonds of governmental units,
30 loan agreements of public or private persons or entities, or
19870H1100B1859 - 14 -
1 other property of any kind.
2 (4) Make covenants as to additional bonds to be issued,
3 the limitations thereon, the terms and conditions thereof,
4 and the custody, application, investment and disposition of
5 the proceeds thereof.
6 (5) Make covenants as to the incurring of other debts by
7 it.
8 (6) Make covenants as to the payment of principal of or
9 interest on bonds, the sources and methods of the payment,
10 the rank or priority of bonds with respect to liens or
11 security interests or the acceleration of maturity of bonds.
12 (7) Provide for replacement of lost, stolen, destroyed
13 or mutilated bonds.
14 (8) Make covenants as to the redemption, purchase or
15 tender of bonds by the authority, or the holders thereof, and
16 the privileges of exchanging them for other bonds.
17 (9) Make covenants to create or authorize the creation
18 of special funds or accounts to be held in trust or otherwise
19 for the benefit of holders of bonds, or of reserves for other
20 purposes and as to the use, investment and disposition of
21 moneys held in those funds, accounts or reserves.
22 (10) Provide for the rights, liabilities, powers and
23 duties arising upon the breach of a covenant, condition or
24 obligation and prescribe the events of default and the terms
25 and conditions upon which any or all of the bonds shall
26 become or may be declared due and payable before maturity and
27 the terms and conditions upon which the declaration and its
28 consequences may be waived.
29 (11) Vest in a trustee or trustees within or without
30 this Commonwealth in trust any property, rights, powers and
19870H1100B1859 - 15 -
1 duties as the authority may determine. These may include any
2 or all of the rights, powers and duties of any trustee
3 appointed by the holders of bonds or notes, including rights
4 with respect to the sale or other disposition of notes and
5 bonds of governmental units and other instruments and
6 security pledged pursuant to a resolution or trust indenture
7 for the benefit of the holders of bonds and the right, by
8 suit or action, to foreclose any mortgage pledged pursuant to
9 the resolution of trust indenture for the benefit of the
10 holders of the bonds, notes or other obligations, and to
11 limit the right of the holders of any bonds to appoint a
12 trustee under this act and to limit the rights, powers and
13 duties of the trustee.
14 (12) Pay the costs or expenses incident to the
15 enforcement of the bonds or the provisions of the resolution
16 authorizing the issuance of those bonds, or the trust
17 indenture securing the bonds or any covenant or agreement of
18 the authority with the holders of the bonds, notes or other
19 obligations.
20 (13) Limit the rights of the holders of any bonds to
21 enforce any pledge or covenant securing bonds.
22 (14) Make covenants other than or in addition to the
23 covenants authorized by this act of like or different
24 character and make covenants to do or refrain from doing any
25 acts and things as may be necessary, or convenient and
26 desirable, in order to better secure bonds or which, in the
27 absolute discretion of the authority, will tend to make bonds
28 more marketable, notwithstanding that the covenants, acts or
29 things may not be enumerated herein.
30 Section 9. Nature and effect of pledges.
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1 A pledge of revenues, receipts, moneys, funds or other
2 property or instruments made by the authority shall be valid and
3 binding from the time when the pledge is made. The revenues,
4 receipts, moneys, funds or other property pledged and thereafter
5 received by the authority shall be immediately subject to the
6 lien or the pledge without its physical delivery or further act,
7 and the lien of any pledge shall be valid and binding as against
8 all parties having claims of any kind in tort, contract or
9 otherwise against the authority irrespective of whether the
10 parties have notice of the lien. Neither the resolution nor any
11 other instrument by which a pledge under this section is created
12 or evidenced need be filed or recorded except in the records of
13 the authority.
14 Section 10. Financial assistance.
15 (a) Project priorities.--
16 (1) The authority may only provide financial assistance
17 to projects which shall meet the following requirements:
18 (i) The project is necessary to ensure the health
19 and safety of the citizens of this Commonwealth, or the
20 project is necessary for the economic vitality of the
21 area the project serves, or the project is necessary to
22 comply with Federal or State environmental laws or
23 regulations.
24 (ii) The project, with this assistance, will proceed
25 in an expeditious manner.
26 (iii) Financial assistance is necessary in order for
27 the project to be completed in a reasonable amount of
28 time.
29 (2) The board shall consult with the Department of
30 Environmental Resources and the partnership in assigning
19870H1100B1859 - 17 -
1 priorities to each project. When necessary to comply with
2 Federal law, priorities assigned by the Department of
3 Environmental Resources shall be binding on the authority,
4 but under no circumstances shall the authority be required by
5 the Department of Environmental Resources to fund these
6 prioritized projects.
7 (3) The board shall attempt to ensure that funds are
8 always available for emergency situations which immediately
9 threaten the health and safety of the residents of this
10 Commonwealth and for economic development when the project
11 must be completed in a short time period in order to attract
12 or retain business within this Commonwealth.
13 (4) The board shall establish a program of assistance to
14 water supply and sewage disposal systems serving communities
15 with a population of 12,000 people, or less, or systems
16 having hookups of 1,000 or less.
17 (b) Grants.--Grants, EXCEPT FOR THOSE UNDER THE COMMUNITY <--
18 FACILITIES PROGRAM, shall be made only when the board, in its
19 sole discretion, determines that the financial condition of the
20 recipient is such that repayment of a loan is unlikely and that
21 the recipient will not be able to proceed with the project
22 without a grant. In considering grant applications, the
23 authority may recommend, either before or after the
24 determination of the board, that the recipient pursue other
25 State grant programs, including, but not limited to, the Site
26 Development program, the Federal Small Communities Block Grant
27 program and the Federal Urban Development Action Grant program.
28 Should the board determine that a grant is necessary from the
29 authority, the board shall attempt to mix the grant funds with
30 loan funds, if financially possible.
19870H1100B1859 - 18 -
1 (c) Loans.--Subject to any agreements with the holders of
2 bonds, the board shall have the power to set interest rates and
3 other terms applicable to loans in any manner it deems
4 appropriate. The board may consider such factors as it deems
5 relevant, including current market interest rates, the financial
6 and economic distress of the area which the project serves, and
7 the necessity to maintain the authority funds in a financially
8 sound manner. Loans may be made based on the ability to repay
9 the loan from future revenue to be derived from the project, by
10 a mortgage or other property lien, or on any other fiscal
11 matters which the authority deems appropriate. The board shall
12 also have the power to provide loans at zero interest and
13 deferred principal loans. In the event of a default on the
14 repayment of a loan, the board may apply to the court of common
15 pleas of the county where the project is located for the
16 appointment of a receiver to assume operation and supervision of
17 the facility under the supervision of the court.
18 (d) Limitation on annual assistance.--The amount of
19 assistance approved by the board under subsection (b) shall not
20 in any fiscal year exceed the amount of interest earnings, State
21 appropriations and any funds received specifically for grants
22 which are deposited into the accounts of the authority.
23 (e) Other assistance.--The board shall have the power to use
24 other methods of financial assistance, including, but not
25 limited to, bond and loan guarantees, and may buy or insure
26 bonds if the board deems this to be an appropriate method to
27 accomplish the purposes of this act.
28 (f) Limitation.--Except for projects approved under section <--
29 10(a)(3) SUBSECTION (A)(3) OR UNDER THE COMMUNITY FACILITIES <--
30 PROGRAM, the board shall not advance any grant or loan or any
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1 other funds to any person or entity in respect to any project
2 until such project shall have been itemized and approved in a
3 capital budget act. This limitation shall not prevent the board
4 from approving projects which are subject to such later
5 itemization and approval prior to funding such approved
6 projects.
7 (g) Containing education of operation.--No agreement with
8 individuals or entities shall be valid in the absence of an
9 agreement by the individuals or entities seeking assistance
10 under this act to assure that the system operators are
11 participating or will participate in continuing education
12 programs developed by the Department of Environmental Resources.
13 If the board determines that the system operator of a system
14 receiving assistance is not participating in continuing
15 education programs, the board shall take all steps necessary to
16 cease all financial assistance and recover all prior payments,
17 including, but not limited to, the immediate repayment of any
18 outstanding loans and interest and any grants.
19 (h) Inspection of project and records.--
20 (1) The applicant shall allow the authority and its
21 successors, agents and representatives the right, at all
22 reasonable times during construction and after completion of
23 the project, to enter upon and inspect the project and to
24 examine and make copies of the applicant's books, records,
25 accounting data and other documents pertaining to the project
26 and the financial condition of the applicant.
27 (2) The applicant may be required by the board or its
28 agent to have prepared independent audits of its financial
29 documents and conditions and submit a certified copy of the
30 audits to the board.
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1 (i) Financial analysis.--The financial analysis used by the
2 board to determine the need of all applicants for financial
3 assistance shall include, but not be limited to, the following:
4 (1) Fair and reasonable costs of wastewater treatment or
5 of supplying drinking water incurred by comparable systems.
6 (2) The incomes of affected ratepayers and their ability
7 to pay increased rates necessary to complete the proposed
8 projects.
9 (3) Other sources of financing available to individuals
10 or entities seeking assistance under this act.
11 (4) A determination that any financial assistance
12 provided by this act will not be used to supplant financial
13 resources already available to the applicant.
14 Section 11. Comprehensive water facilities plan.
15 The Department of Environmental Resources shall prepare and
16 submit to the authority a comprehensive plan for wastewater
17 disposal and piped drinking water facilities in this
18 Commonwealth. The plan should include, but not be limited to:
19 (1) An inventory of the existing facilities located
20 within this Commonwealth, including, but not limited to,
21 identification of the type, capacity, location, current
22 condition and year constructed.
23 (2) An inventory of drinking water and sewage
24 construction needs.
25 (3) Identification of the major issues and problems that
26 the Commonwealth must deal with in order to address its water
27 infrastructure needs, including financial as well as
28 nonfinancial issues.
29 (4) Recommendations for programs to encourage the
30 construction of drinking water and sewage treatment
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1 facilities. This may include innovative financing mechanisms,
2 alternative technology and ownership structures, and
3 technical assistance.
4 (5) Identification of emerging issues, trends and
5 problems that might affect these facilities.
6 The plan shall be updated at least every five years.
7 Section 12. Audits.
8 The accounts and books of the authority, including its
9 receipts, disbursements, contracts, mortgages, investments and
10 other matters relating to its finances, operation and affairs,
11 shall be examined and audited by the Auditor General.
12 Section 13. Annual report.
13 The board shall provide the General Assembly with an annual
14 report detailing all projects funded under section 10(a)(3) of
15 this act and all projects receiving assistance from communities <--
16 COMMUNITY facilities funds. <--
17 Section 14. Expedited approval of rate relief.
18 For the limited and special purpose of ensuring repayment of
19 principal and interest on loans made pursuant to this act, the
20 Pennsylvania Public Utility Commission shall approve such
21 security issues, affiliated interest agreements and rate
22 increase requests by applicants that are regulated utilities as
23 are necessary and appropriate. For this purpose, the
24 Pennsylvania Public Utility Commission shall establish such
25 expedited practices, procedures and policies as necessary to
26 facilitate and accomplish repayment of the loans. Nothing in
27 this act shall be construed as to require approval of rate
28 increases greater than that necessary to accomplish the
29 repayment of loans made pursuant to this act.
30 Section 15. Transfer of Water Facilities Loan Board.
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1 (a) Removal of members.--On the effective date of this act,
2 all existing members of the Water Facilities Loan Board are
3 removed from office.
4 (b) Board of directors to serve as Water Facilities Loan
5 Board.--For purposes of satisfying all outstanding obligations
6 of the Water Facilities Loan Board and for purposes of
7 collecting loan and interest repayments, the board established
8 in section 4 shall constitute the membership of the Water
9 Facilities Loan Board.
10 (c) Transfer of function.--All remaining rights, powers,
11 duties, obligations, liabilities, records and equipment of the
12 Water Facilities Loan Board are transferred to the authority.
13 Section 16. Repeals.
14 (a) Absolute.--The following acts or parts of acts are
15 repealed:
16 The definitions of "community water supply system,"
17 "department," "flood control facility," "port facility,"
18 "project" and "water facility" in section 7502 and sections
19 7503, 7504(b), (d) and (e), 7506, 7510, 7511, 7512, 7513, 7514,
20 7515 and 7516 of Title 32 of the Pennsylvania Consolidated
21 Statutes (relating to forests, waters and State parks).
22 (b) Limited.--The following acts or parts of acts are
23 repealed insofar as they relate to any one of the following: <--
24 (1) Public improvement projects itemized in a capital <--
25 budget enacted prior to January 1, 1983, but not physically
26 constructed prior to the effective date of this act.
27 (2) (1) Any project itemized in a capital budget which <--
28 was funded by current revenues without the use of bond
29 obligations.
30 (3) (2) Sections 1, 1.1, 2 and 3 of the act of August <--
19870H1100B1859 - 23 -
1 20, 1953 (P.L.1217, No.339), entitled "An act providing for
2 payments by the Commonwealth to municipalities which have
3 expended money to acquire and construct sewage treatment
4 plants in accordance with the Clean Streams Program and the
5 act, approved the twenty-second day of June, one thousand
6 nine hundred thirty-seven (Pamphlet Laws 1987), and making an
7 appropriation," as applied to projects funded under the
8 provisions of this act.
9 (c) Inconsistent.--All other acts and parts of acts are
10 repealed insofar as they are inconsistent with this act.
11 Section 17. Severability.
12 The provisions of this act are severable. If any provision of
13 this act or its application to any person or circumstance is
14 held invalid, the invalidity shall not affect other provisions
15 or applications of this act which can be given effect without
16 the invalid provision or application.
17 Section 18. Effective date.
18 This act shall take effect in 90 days.
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