THE GENERAL ASSEMBLY OF PENNSYLVANIA

SENATE BILL

INTRODUCED BY EICHELBERGER, RAFFERTY, ORIE, TARTAGLIONE, ERICKSON, GORDNER, ALLOWAY, WASHINGTON, BRUBAKER, WAUGH, GREENLEAF, EARLL, WOZNIAK AND PILEGGI, FEBRUARY 1, 2011

REFERRED TO LOCAL GOVERNMENT, FEBRUARY 1, 2011  

AN ACT

Amending the act of February 1, 1966 (1965 P.L.1656, No.581),

entitled "An act concerning boroughs, and revising, amending

and consolidating the law relating to boroughs," further

providing for general powers.

The General Assembly of the Commonwealth of Pennsylvania

hereby enacts as follows:

Section 1.  Section 1201 of the act of February 1, 1966 (1965

P.L.1656, No.581), known as The Borough Code, amended November

29, 2004 (P.L.1337, No.170) and June 30, 2007 (P.L.47, No.15) is

amended to read:

Section 1201.  General Powers.--A borough may:

(1)  Have succession perpetually by its corporate name.

(2)  Sue and be sued, and complain and defend in the courts

of the Commonwealth.

(3)  Make and use a common seal, and alter the same at

pleasure.

(4)  Purchase, acquire by gift, or otherwise, hold, lease,

let and convey, by sale or lease, such real and personal

property as shall be deemed to be to the best interest of the

borough, subject to the following restrictions, limitations or

exceptions:

(i)  No real estate owned by the borough shall be sold for a

consideration in excess of fifteen hundred dollars ($1500),

except to the highest bidder after due notice by advertisement

for bids or advertisement of a public auction in one newspaper

of general circulation in the borough. Such advertisement shall

be published once not less than ten days prior to the date fixed

for the opening of bids or public auction, and such date for

opening bids or public auction shall be announced in such

advertisement. The award of contracts shall be made only by

public announcement at a regular or special meeting of council

or at the public auction. All bids shall be accepted on the

condition that payment of the purchase price in full shall be

made within sixty days of the acceptance of bids. The borough

council shall have the authority to reject all bids if such bids

are deemed to be less than the fair market value of the real

property. In the case of a public auction, the borough council

may establish a minimum bid based on the fair market value of

the real property. Real estate owned by a borough may be sold at

a consideration of fifteen hundred dollars ($1500) or less

without advertisement or competitive bidding only after council

estimates the value thereof upon receipt of an appraisal by a

qualified real estate appraiser.

(ii)  Except as otherwise hereinafter provided in the case of

personal property of an estimated fair market value of less than

one thousand dollars ($1,000), no borough personal property

shall be disposed of, by sale or otherwise, except upon approval

of council, by ordinance or resolution. In cases where council

shall approve a sale of such property, it shall estimate the

fair market value of the entire lot to be disposed of. If

council shall estimate the fair market value to be one thousand

dollars ($1,000) or more, the entire lot shall be advertised for

sale once, in at least one newspaper of general circulation in

the borough, not less than ten days prior to the date fixed for

the opening of bids or public auction, and such date of opening

of bids or public auction, shall be announced in such

advertisement, and sale of the property so advertised shall be

made to the best responsible bidder. A public auction of

personal property may be conducted by means of an online or

electronic auction sale. During an electronic auction sale, bids

shall be accepted electronically at the time and in the manner

designated in the advertisement. During the electronic auction,

each bidder shall have the capability to view the bidder's bid

rank or the high bid price. Bidders may increase their bid

prices during the electronic auction. The record of the

electronic auction shall be accessible for public inspection.

The purchase price shall be paid by the high bidder immediately

or at a reasonable time after the conclusion of the electronic

auction as determined by council. In the event that shipping

costs are incurred, they shall be paid by the high bidder. A

borough that has complied with the advertising requirements of

this section may provide additional public notice of the sale by

bids or public auction in any manner deemed appropriate by

council. The advertisement for electronic auction sales

authorized in this subclause shall include the Internet address

or means of accessing the electronic auction and the date, time

and duration of the electronic auction. Council may reject any

bids received if the bids are believed to be less than the fair

market value of the property. Council shall, by resolution,

adopt a procedure for the sale of surplus personal property,

either individual items or lots of items, of an estimated fair

market value of less than one thousand dollars ($1,000) and the

approval of council shall not be required for any individual

sale that shall be made in conformity to such procedure.

(iii)  The provisions of this clause shall not be mandatory

where borough property is to be traded in or exchanged for new

borough property.

(iv)  The provisions of this clause requiring advertising for

bids or sale at public auction and sale to the highest bidder

shall not apply where borough real or personal property is to be

sold to:

(A)  a county, city, borough, town, township, institution

district, school district, volunteer fire company, volunteer

ambulance service or volunteer rescue squad located within the

borough;

(A.1)  a council of government, consortium, cooperative or

other similar entity created pursuant to 53 Pa.C.S. Ch. 23 

(relating to intergovernmental cooperation);

(B)  [a municipal authority pursuant to the Municipality

Authorities Act of 1945] an authority as defined in 53 Pa.C.S. §

5602 (relating to definitions);

(C)  a non-profit corporation engaged in community

development or reuse only upon entering into a written agreement

with the non-profit corporation that requires the property to be

used for industrial, commercial or affordable housing purposes.

This exemption shall not apply to property on which existing

governmental functions are conducted;

(D)  where real property is to be sold to a person for his

exclusive use in an industrial development program;

(E)  where real property is to be sold to a non-profit

corporation organized as a public library for its exclusive use

as a library;

(F)  where real property is to be sold to a non-profit

medical service corporation as authorized by clause (76) of

section 1202;

(G)  where real property is to be sold to a non-profit

housing corporation as authorized by clause (77) of section

1202;

(H)  where real property is to be sold to the Commonwealth or

to the Federal Government; or

(I)  where real property is to be sold to a non-profit museum

or historical society for its exclusive use as a non-profit

museum or historical society.

(v)  When real property is to be sold to a non-profit

corporation organized as a public library for its exclusive use

as a library or to a non-profit medical service corporation or

to a non-profit housing corporation, council may elect to accept

such nominal consideration for such sale as it shall deem

appropriate.

(vi)  Real property sold pursuant to this clause to a

volunteer fire company, volunteer ambulance service or volunteer

rescue squad, non-profit medical service corporation or to a

non-profit housing corporation shall be subject to the condition

that when the property is not used for the purposes of the

company, service, squad or the corporation the property shall

revert to the borough.

(vii)  The exemption granted under subclause (iv)(C) shall

not apply to property owned and operated by the borough or

subcontracted or operated on the behalf of the borough in order

to conduct existing governmental functions.

(5)  To invest in or purchase bonds of any municipal

authority or parking authority created solely by the borough,

for the purpose either of investment or of possible retirement

of such bonds and acquisition of authority projects at an

earlier date than originally contemplated, using for the purpose

either surplus funds of the borough or money appropriated in the

annual budget for the purpose.

Section 2.  This act shall take effect immediately.