THE GENERAL ASSEMBLY OF PENNSYLVANIA

SENATE BILL

INTRODUCED BY EICHELBERGER, ROBBINS, ERICKSON, STOUT AND WOZNIAK, DECEMBER 14, 2009

REFERRED TO LOCAL GOVERNMENT, DECEMBER 14, 2009  

AN ACT

Amending Title 16 (Counties) of the Pennsylvania Consolidated

Statutes, adding provisions for required fiscal security

through bonding, blanket bonding and insuring of elected and

appointed county officers and employees; providing for

determining the form, amount and payment of premiums for and

the filing and recording of the required security and for the

subsequent issuance of official commissions; and making

related repeals.

TABLE OF CONTENTS

TITLE 16

COUNTIES

PART I.  PRELIMINARY PROVISIONS (Reserved)

PART II.  CREATION, ALTERATION AND FUNCTIONS (Reserved)

PART III.  GOVERNMENT AND ADMINISTRATION

Subpart A.  General Provisions

Chapter 11.  General Provisions

Subchapter A.  (Reserved)

Subchapter B.  Required Fiscal Security for Officers and

Employees

§ 1121.  Short title and scope of subchapter.

§ 1122.  Definitions.

§ 1123.  Required security.

§ 1124.  Official security and officers.

§ 1125.  Other county officers and employees, deputies and other

appointees of county officers.

§ 1126.  County officers and employees acting as agents.

§ 1127.  Bonds or blanket bond as security coverage.

§ 1128.  Insurance as security coverage.

§ 1129.  Form of required security.

§ 1130.  Amount of coverage.

§ 1131.  Custody and filing of required security documents.

§ 1132.  Payment of premiums and commissions on collections.

§ 1133.  Other requirements, references and approvals.

The General Assembly of the Commonwealth of Pennsylvania

hereby enacts as follows:

Section 1.  Title 16 of the Pennsylvania Consolidated

Statutes is amended by adding parts to read:

PART I

PRELIMINARY PROVISIONS (Reserved)

PART II

CREATION, ALTERATION AND FUNCTIONS (Reserved)

PART III

GOVERNMENT AND ADMINISTRATION

Subpart

A.  General Provisions

CHAPTER 11

GENERAL PROVISIONS

Subchapter

A.  (Reserved)

B.  Required Fiscal Security for Officers and Employees

Sec.

1121.  Short title and scope of subchapter.

1122.  Definitions.

1123.  Required security.

1124.  Official security and officers.

1125.  Other county officers and employees, deputies and other

appointees of county officers.

1126.  County officers and employees acting as agents.

1127.  Bonds or blanket bond as security coverage.

1128.  Insurance as security coverage.

1129.  Form of required security.

1130.  Amount of coverage.

1131.  Custody and filing of required security documents.

1132.  Payment of premiums and commissions on collections.

1133.  Other requirements, references and approvals.

§ 1121.  Short title and scope of subchapter.

(a)  Short title of subchapter.--This subchapter shall be

known and may be cited as the County Officer and Employee Fiscal

Security Act.

(b)  Scope of subchapter.--This subchapter applies to

security coverage and additional coverage in the form of bonds,

blanket bonds or insurance, protecting against events of loss by

officers and employees in counties of the second class, second

class A, third class, fourth class, fifth class, sixth class,

seventh class or eighth class, including counties of these

classes which have adopted a home rule charter or an optional

plan.

(c)  Inapplicability.--This subchapter shall not apply to

bonds of county treasurers acting as tax collectors as provided

in section 4 of the act of May 25, 1945 (P.L.1050, No.394),

known as the Local Tax Collection Law.

§ 1122.  Definitions.

The following words and phrases when used in this subchapter

shall have the meanings given to them in this section unless the

context clearly indicates otherwise:

"Additional coverage."  Insurance that covers each county

officer or employee who is required to receive, account for or

hold any money or property by virtue of his or her office or

employment and which, at a minimum, indemnifies the county

against the loss of money and property through robbery, burglary

and larceny.

"Blanket bond."  Security coverage in the form of a bond for

county officers and employees as follows:

(1)  for county officers and employees as a comprehensive

group;

(2)  for a group of named county officers and employees;

or

(3)  for county officers and employees in scheduled

positions.

"Bond."  Security coverage under which a surety guarantees

the performance of a duty by a county officer or employee in

compliance with this subchapter.

"County."  A county of the second class, second class A,

third class, fourth class, fifth class, sixth class, seventh

class or eighth class, including counties of these classes which

have adopted or may adopt a home rule charter or an optional

plan.

"County officers and employees."  Elected and appointed

county officials, the deputies and other appointees of county

elected and appointed officials and county employees, whether

acting on behalf of the county or as agents of a Commonwealth

agency or the judicial branch, who are required to receive,

account for or hold any money or property by virtue of their

office or employment.

"Crime-fidelity insurance."  Insurance that is endorsed with

faithful performance of duty coverage and which insures, at a

minimum, against events of loss of money or other property,

resulting from one or more fraudulent or dishonest acts,

including, but not limited to, embezzlement, theft, forgery,

similar acts of dishonesty or fraud by a county officer or

employee acting alone or in collusion with others, or from a

breach of fiduciary duty or a failure of a county officer or

employee to perform faithfully his or her duties or to account

properly for all money and property received, held or required

to be accounted for, by virtue of his or her office or

employment.

"Governing authority."  Includes:

(1)  The Supreme Court.

(2)  Any agency or unit of the unified judicial system

exercising a power or performing a duty under 42 Pa.C.S. §

1721 (relating to delegation of powers).

"Governing body."  The county board of commissioners or the

body vested with the legislative authority of the county in

counties which have adopted a home rule charter or an optional

plan.

"Home rule charter."  A charter adopted under 53 Pa.C.S. Pt.

III Subpt. E (relating to home rule and optional plan

government) or its predecessor, the former act of April 13, 1972

(P.L.184, No.62), known as the Home Rule Charter and Optional

Plans Law, or Article XXXI-C of the act of July 28, 1953

(P.L.723, No.230), known as the Second Class County Code.

"Judicial branch."  The judicial branch specified in section

10(c) of Article V of the Constitution of Pennsylvania.

"Money."  Coin or currency of the United States or of any

other country, travelers checks, personal checks, bank checks

and bank notes in current use and having a face value, money

orders and securities.

"Official security."  Security on behalf of a county officer

to provide protection from events of loss or misconduct when the

officer fails to faithfully perform the duties of the office.

"Optional plan."  An optional plan adopted under 53 Pa.C.S.

Pt. III Subpt. E (relating to home rule and optional plan

government) or its predecessor, the former act of April 13, 1972

(P.L.184, No.62), known as the Home Rule Charter and Optional

Plans Law.

"Required security."  Security coverage and additional

coverage provided in compliance with this subchapter.

"Securities."  All negotiable and nonnegotiable instruments

or contracts representing either money or other property,

including revenue and other stamps in current use, tokens and

tickets and evidences of debt issued in connection with credit

or charge cards, which cards are not issued by the county.

"Security coverage."  A bond, a blanket bond or a crime-

fidelity insurance policy, which is endorsed with faithful

performance of duty coverage, provided in compliance with this

subchapter for the purpose of protecting against the loss of

money and other property sustained as a result of one or more

fraudulent or dishonest acts, including, but not limited to,

embezzlement, theft, forgery, similar acts of dishonesty or

fraud by a county officer or employee acting alone or in

collusion with others or from a breach of fiduciary duty or a

failure of a county officer or employee to perform faithfully

his or her duties or to account properly for all money and

property received by virtue of his or her position or

employment.

§ 1123.  Required security.

(a)  In general.--A county shall have the power and its duty

shall be to provide security coverage and additional coverage to

county officers and employees in accordance with this

subchapter.

(b)  Security coverage.--Security coverage shall be provided

in accordance with the following:

(1)  Section 1124 (relating to official security and

officers).

(2)  Section 1125 (relating to other county officers and

employees; deputies and other appointees of county officers).

(3)  Section 1126 (relating to county officers and

employees acting as agents).

(c)  Additional coverage.--Supplemental to or as part of the

security coverage to be provided in accordance with this

subchapter, additional coverage in the form of adequate

insurance indemnifying against the loss of money and property

through robbery, burglary and larceny, shall be provided for

each county officer or employee who is required to receive,

account for or hold any money and other property by virtue of

his or her office or employment.

(d)  Primary liability.--

(1)  Except as provided in paragraph (2), the county

shall be primarily liable for a claim for the loss of money

and property which a county officer or employee is required

to receive, account for or hold by virtue of his or her

office or employment, to the extent that the loss is or could

have been the subject of required security under this

subchapter.

(2)  The county shall not be primarily liable for a claim

for the loss of money and property under paragraph (1) to the

extent that recovery of the loss can be obtained from other

insurance or bond protection provided by the Commonwealth

agency or any other person or entity asserting a claim.

(3)  With regard to the loss of money or property,

nothing in this subchapter shall be deemed to restrict or

diminish a county's right to reimbursement or subrogation or

to limit any right the county may have to be indemnified or

receive restitution for the loss.

§ 1124.  Official security and officers.

(a)  Official security.--Each county shall obtain official

security in the form of bonds, a blanket bond or a crime-

fidelity insurance policy, which is endorsed with faithful

performance of duty coverage, on behalf of the officers set

forth in subsection (b) or the equivalent officers in home rule

or optional plans counties, whether elected, appointed or

appointed to fill a vacancy, before those officers enter upon

their official duties.

(b)  Officers.--The following are the officers or equivalent

officers in home rule or optional plans counties upon whose

behalf official security shall be obtained in accordance with

subsection (a):

(1)  Each county commissioner.

(2)  The chief clerk of the county commissioners.

(3)  The controller.

(4)  The county treasurer.

(5)  The prothonotary of the court of common pleas.

(6)  The sheriff.

(7)  The coroner.

(8)  The clerk of the courts of the court of common

pleas.

(9)  The clerk of the orphans' court division of the

court of common pleas.

(10)  The recorder of deeds.

(11)  The register of wills.

(12)  The probation and parole officers, if required by

order of court to give bond to the county.

(13)  The fire marshal and deputy fire marshals, if

required by law to give bond.

(14)  The secretary of the board of health and the health

officer in counties in which they are required by law to give

bond.

§ 1125.  Other county officers and employees, deputies and other

appointees of county officers.

With regard to county officers and employees generally who

are not subject to section 1124 (relating to official security

and officers), including the deputies and other appointees in

each county office, who are required to receive, account for or

hold any money and other property by virtue of their office or

employment, each county shall obtain security coverage, in the

form of a blanket bond or a crime-fidelity insurance policy,

with faithful performance of duty coverage for all such

officers, employees, deputies and appointees.

§ 1126.  County officers and employees acting as agents.

Each county shall obtain security, in the form of a bond,

blanket bond or a crime-fidelity insurance policy covering

county officers and employees acting as agents of a Commonwealth

agency or the judicial branch in accordance with this subchapter

or any other law, regulation or rule requiring the posting of

security in the form of a bond or otherwise.

§ 1127.  Bonds or blanket bond as security coverage.

(a)  In general.--A county may comply with section 1123(b)

(relating to required security) by providing bonds or a blanket

bond in accordance with the following:

(1)  The bond or blanket bond shall be joint and several,

with one or more corporate sureties, which shall be surety

companies authorized to do business in this Commonwealth and

licensed by the Insurance Commissioner.

(2)  The bond or blanket bond shall be conditioned upon

each of the following:

(i)  The faithful performance of all duties required

of the person holding the office or position.

(ii)  The just and faithful use, appropriation,

accounting or payment over, according to law, of all

moneys and balances and other property, which is required

to be received, accounted for or held by the officer or

employee by virtue of his or her office or employment

whether on behalf of the county, the Commonwealth, any

political subdivision or any other person.

(iii)  The delivery to the successor or successors in

office of all books, papers, documents or other official

things, whole, safe and undefaced, held in right of the

office.

(3)  A bond or blanket bond shall be taken in the name of

the county and, in case of a breach of any of the conditions

thereof by the acts or neglect of the principal or principals

on the bond, shall be for the use of the county, the

Commonwealth, any political subdivision or any other person

as that person's interest shall otherwise appear.

(4)  The county, the Commonwealth, any political

subdivision or other interested persons may sue upon the bond

in its or their own names for its or their own use. Acts of

the General Assembly pertaining to actions and limitations of

actions upon official bonds given to the Commonwealth shall

apply to the bonds provided for in this subchapter just as if

they were given to the Commonwealth, except as otherwise

specifically provided in this subchapter.

(b)  Combined offices.--In counties in which any of the

county offices as set forth in section 1123(b) are combined, if

officers are covered by individual bonds, a single bond covering

the combined offices shall suffice for the officer holding the

combined offices.

§ 1128.  Insurance as security coverage.

A county may comply with section 1123(b) (relating to

required security) by providing crime-fidelity insurance for

county officers or employees in accordance with this subchapter.

§ 1129.  Form of required security.

The form and contents of a bond, a blanket bond or insurance

obtained in compliance with this subchapter shall be approved by

the governing body, after review by the county solicitor and

consultation with the county risk manager, if any. In cases in

which required security is being provided for a county officer

or employee who is acting as an agent for a Commonwealth agency

or the judicial branch, the relevant Commonwealth agency or the

appropriate governing authority may review and comment on the

form of the required security. In approving the form and

contents of a bond, a blanket bond or insurance obtained in

compliance with this subchapter, the governing body may refer to

sample forms that may be made available by the Department of

State.

§ 1130.  Amount of coverage.

(a)  Governing body.--The governing body shall have the power

and its duty shall be to establish a procedure pursuant to which

the governing body shall annually determine an amount of

required security in whatever form that will be reasonably

sufficient to protect against the risks of loss to be covered in

compliance with this subchapter.

(b)  Risk manager.--The governing body may appoint a risk

manager who, at the request of the governing body, shall compile

and submit information relevant to the determination of an

amount of required security under subsection (a).

(c)  Consultation.--In determining the amount of required

security under this section for a county officer or employee who

is acting as an agent for a Commonwealth agency or the judicial

branch, the governing body may, or the risk manager shall, if

directed by the governing body, give notice in writing to the

secretary or head of the relevant Commonwealth agency or the

appropriate governing authority. The Commonwealth agency or

governing authority may provide input concerning the amount of

security it believes is reasonably sufficient to protect against

the risks of loss to be covered in compliance with this

subchapter. Nothing in this subchapter shall impair the right of

a Commonwealth agency from approving the amount of required

security, if it is explicitly authorized by law to approve the

amount of a bond or other security of a county officer or

employee acting as its agent.

§ 1131.  Custody and filing of required security documents.

(a)  Custody.--The governing body shall direct the chief

clerk or equivalent officer in a home rule or optional plan

county to present the documents evidencing required security

obtained in accordance with this subchapter to the recorder of

deeds or equivalent officer in a home rule or optional plan

county for recording. No tax, fee or other charge shall be

imposed for the recording of documents in compliance with this

section. After the documents evidencing required security are

recorded, they shall be returned to the chief clerk or

equivalent officer in a home rule or optional plan county, who

shall maintain the custody of these documents on behalf of the

governing body.

(b)  Department of State filing of required security

documents and commissions.--

(1)  In satisfaction of section 809 of the act of April

9, 1929 (P.L.177, No.175), known as The Administrative Code

of 1929, it shall be sufficient for a copy of the recorded

documents evidencing the required security for county

officers to be filed with the Department of State in

accordance with deadlines established by the department.

(2)  No other filing or approvals, except as provided in

section 1133(c)(2) (relating to other requirements,

references and approvals) of documents evidencing the

required security for county officers, except that required

in accordance with paragraph (1), shall be required as a

condition to the issuance of commissions to elected county

officials by the Department of State according to law.

(3)  Notwithstanding the provision of any other law, no

tax, fee or other charge shall be imposed as a result of the

issuance of the commissions to elected county officials, and

no fee may be made for the recording of required security

documents or commissions.

(c)  Copies.--If requested by the Commonwealth agency or

governing authority of the judicial branch on whose behalf a

county officer or employee is acting as an agent, a copy of

recorded documents evidencing the required security shall be

provided by the chief clerk or the equivalent officer in a home

rule or optional plans county to the Commonwealth agency or

governing authority. No charge or fee shall be imposed for any

copy provided in accordance with this subsection.

(d)  Filing by governing body.--The governing body shall have

the duty to file documents as required by this section.

(e)  Retention of documents.--Documents evidencing required

security shall be held by the custodian thereof for the longer

of the following periods:

(1)  For at least one year after the officer's term of

office or employee's period of employment and, in the case of

a county officer or employee who is acting as an agent for a

Commonwealth agency of the judicial branch, for at least one

year after the settlement of accounts with the Commonwealth

agency or the governing authority.

(2)  For the period of time required by the act of August

14, 1963 (P.L.839, No.407), entitled "An act creating a

county records committee; imposing powers and duties upon it;

authorizing the Pennsylvania Historical and Museum Commission

to assist and cooperate with it; defining county records; and

authorizing the disposition of certain county records by

county officers in counties of the second to eighth class,"

or the rules and regulations adopted pursuant thereto.

(f)  Evidence.--A copy of original documents evidencing

required security, certified as true and correct by the

custodian thereof, or a copy of the recorded documents

evidencing required security, certified as true and correct by

the recorder of deeds, shall be competent evidence thereof in

any judicial proceeding, in the same manner as the original

would be if produced and offered in evidence.

(g)  Sufficiency of filing and recording.--Notwithstanding

any other provision of law, it shall be sufficient to file and

record documents evidencing required security in accordance with

this subchapter without further acknowledgment, filing or

recording of these documents with any other county officer or

with any other Commonwealth agency, except as required by this

subchapter.

§ 1132.  Payment of premiums and commissions on collections.

(a)  Premiums and costs.--The premiums and costs for all

forms of required security for county officials and employees

shall be paid by the county. The requirement of this subchapter

that a county acquire and pay the premiums and costs for

required security shall not relieve a Commonwealth agency on

whose behalf a county officer or employee is acting as an agent

from an obligation, imposed by law, to procure insurance or

bonding protection.

(b)  Commissions on collections.--Nothing in this subchapter

shall affect the right, provided for in any other law, of a

county officer or employee to retain a commission, for use of

the county, on amounts collected or transmitted as agent for a

Commonwealth agency. Notwithstanding the right to retain

commissions in accordance with this paragraph, no county officer

or employee shall be entitled to retain any additional sums from

amounts collected for or to be transmitted to the Commonwealth

agency for the purpose of paying premiums or costs related to

the acquisition of required security.

§ 1133.  Other requirements, references and approvals.

(a)  Compliance with this subchapter.--A requirement in

another law, regulation or rule that a bond be provided by a

county officer or employee to secure the faithful performance of

duty or to act as the agent of a Commonwealth agency or the

judicial branch may be satisfied by including this obligation

within the coverage of required security supplied in accordance

with this subchapter.

(b)  Reference to bonds.--Reference to bonds of county

officers and employees in any other law shall be construed and

read together with this subchapter, and if a conflict exists

between this subchapter and the reference to bonds of county

officers and employees in any other law, the provisions of this

subchapter shall prevail.

(c)  Other approvals.--Notwithstanding any other provision of

law, the following shall apply to required security in the form

of a bond, a blanket bond or insurance:

(1)  Except as provided in paragraph (2), when required

security is obtained in compliance with this subchapter, it

shall not require the approval of any Commonwealth agency or

the Governor as to form, contents or amount.

(2)  If, by law, a Commonwealth agency or the Governor is

explicitly authorized to approve the amount of a bond or

other security of a county officer or employee, the amount of

required security under this subchapter shall be subject to

approval by the Commonwealth agency or the Governor, which

approval shall not be unreasonably withheld.

Section 2.  Repeals are as follows:

(1)  The General Assembly declares that the repeals under

paragraph (2) are necessary to effectuate the amendment or

addition of 16 Pa.C.S. Ch. 11 Subch. B.

(2)  The following acts and parts of acts are repealed:

(i)  Sections 420, 421, 422, 423, 424, 425, 426, 427,

428, 429, 430, 431, 432, 433, 434, 435, 436, 437, 802,

803, 804 of the act of August 9, 1955 (P.L.323, No.130),

known as The County Code.

(ii)  Sections 420, 421, 422, 423, 424, 425, 426,

427, 428, 429, 430, 431, 802, 803, 804, 1261 and 1262 of

the act of July 28, 1953 (P.L.723, No.230), known as the

Second Class County Code.

(iii)  As much of section 3103 of the Second Class

County Code, as reads as follows: "The bond of the fire

marshal shall be in the sum of ten thousand dollars

($10,000) and the bonds of the deputy fire marshals shall

be in the sum of five thousand dollars ($5000)."

(3)  All acts and parts of acts are repealed insofar as

they are inconsistent with this act.

Section 3.  A county may, at any time after the effective

date of this section, obtain required security in accordance

with 16 Pa.C.S. Ch.11 Subch. B. A county shall have in place

required security in accordance with 16 Pa.C.S. Ch.11 Subch. B

prior to the time that any elected county official takes office

after the municipal election next following the effective date

of this section. Bonds and insurance, which, on the effective

date of this section, cover county officers and employees, shall

remain in force and effect until required security is purchased. 

Section 4.  This act shall take effect immediately.