SENATE AMENDED PRIOR PRINTER'S NOS. 834, 2014, 2197 PRINTER'S NO. 3273
No. 757 Session of 1991
INTRODUCED BY STETLER, ANGSTADT, BILLOW, BUNT, CAPPABIANCA, COLAIZZO, COY, DEMPSEY, KOSINSKI, LINTON, McNALLY, MERRY, PESCI, PISTELLA, SERAFINI, STURLA, TRELLO, VAN HORNE AND WAMBACH, MARCH 13, 1991
AS AMENDED ON SECOND CONSIDERATION, IN SENATE, MARCH 17, 1992
AN ACT
1 Amending the act of June 23, 1931 (P.L.932, No.317), entitled
2 "An act relating to cities of the third class; and amending,
3 revising, and consolidating the law relating thereto,"
4 granting city council the authority to determine whether or
5 not security should accompany bids submitted in response to
6 advertisement; AND FURTHER PROVIDING FOR REGULATIONS <--
7 CONCERNING CONTRACTS AND FOR BONDS FOR PROTECTION OF LABOR
8 AND MATERIALMEN.
9 The General Assembly of the Commonwealth of Pennsylvania
10 hereby enacts as follows:
11 Section 1. Section 1901(f) AND (G) of the act of June 23, <--
12 1931 (P.L.932, No.317), known as The Third Class City Code,
13 reenacted and amended June 28, 1951 (P.L.662, No.164) and
14 amended September 17, 1959 (P.L.906, No.359), is ARE amended to <--
15 read:
16 Section 1901. Power to Make Contracts; Regulations
17 Concerning Contracts.--* * *
18 (f) [All bids advertised for shall be accompanied by cash,
19 by a certified or cashier's good faith check in an amount
1 required by council but at least ten per centum of the bid, or 2 by a bond with corporate surety in such amount as council shall 3 determine but not less than ten per centum of the amount bid.] 4 Council may require that any bids so advertised be accompanied 5 by cash, by a certified or cashier's good faith check or other 6 irrevocable letter of credit in a reasonable amount, or by a 7 bond with corporate surety in a reasonable amount. Whenever it 8 is required that a bid be accompanied by cash, certified check, 9 cashier's good faith check or other irrevocable letter of 10 credit, no bid shall be considered unless so accompanied. In the 11 event any bidder shall, upon award of the contract to him, fail 12 to comply with the requirements hereinafter stated as to a bond 13 guaranteeing the performance of the contract the good faith 14 deposit by cash, certified check, or bond, shall be forfeited to 15 the city as liquidated damages. 16 * * * <-- 17 (G) WHERE ADVERTISING IS REQUIRED HEREIN, THE SUCCESSFUL <-- 18 BIDDER SHALL BE REQUIRED TO FURNISH A BOND OR IRREVOCABLE LETTER 19 OF CREDIT IN AN AMOUNT SUFFICIENT TO COUNCIL WITH SUITABLE 20 REASONABLE REQUIREMENTS GUARANTEEING THE PERFORMANCE OF THE 21 CONTRACT[, WITH SURETY SUFFICIENT TO COUNCIL,] WITHIN TWENTY 22 DAYS AFTER THE CONTRACT HAS BEEN AWARDED, UNLESS COUNCIL 23 PRESCRIBES A SHORTER PERIOD OF NOT LESS THAN TEN DAYS, AND 24 FAILURE TO FURNISH SUCH [BOND] SECURITY WITHIN SUCH TIME SHALL 25 [AVOID] VOID THE AWARD. THE PROVISIONS OF THIS SUBSECTION 26 REQUIRING SUCCESSFUL BIDDERS TO FURNISH [BOND] SECURITY SHALL 27 NOT BE MANDATORY AS TO CONTRACTS FOR THE PURCHASE OF MOTOR 28 VEHICLES OR OTHER PIECES OF EQUIPMENT BUT ONLY AS TO THOSE 29 CONTRACTS WHICH INVOLVE FURNISHING OF LABOR AND MATERIALS. 30 COUNCIL MAY IN ALL CASES OF CONTRACTS OR PURCHASES REQUIRE 19910H0757B3273 - 2 -
1 [BONDS] SECURITY FOR PERFORMANCE, DELIVERY, OR OTHER TERMS. 2 * * * 3 SECTION 2. SECTION 1907 OF THE ACT, AMENDED OCTOBER 9, 1967 4 (P.L.378, NO.170), IS AMENDED TO READ: 5 SECTION 1907. [BONDS] SECURITY FOR THE PROTECTION OF LABOR 6 AND MATERIALMEN.--IT SHALL BE THE DUTY OF EVERY CITY TO REQUIRE 7 ANY PERSON, COPARTNERSHIP, ASSOCIATION, OR CORPORATION, ENTERING 8 INTO A CONTRACT WITH SUCH CITY FOR THE CONSTRUCTION, ERECTION, 9 INSTALLATION, COMPLETION, ALTERATION, REPAIR OF, OR ADDITION TO, 10 ANY PUBLIC WORK OR IMPROVEMENT OF ANY KIND WHATSOEVER, WHERE THE 11 AMOUNT OF SUCH CONTRACT IS IN EXCESS OF ONE THOUSAND FIVE 12 HUNDRED DOLLARS, BEFORE COMMENCING WORK UNDER SUCH CONTRACT, TO 13 EXECUTE AND DELIVER TO SUCH CITY, IN ADDITION TO ANY OTHER 14 [BOND] SECURITY WHICH MAY NOW OR HEREAFTER BE REQUIRED BY LAW TO 15 BE GIVEN IN CONNECTION WITH SUCH CONTRACT, AN ADDITIONAL BOND OR 16 IRREVOCABLE LETTER OF CREDIT FOR THE USE OF ANY AND EVERY 17 PERSON, COPARTNERSHIP, ASSOCIATION, OR CORPORATION INTERESTED, 18 IN A SUM NOT LESS THAN FIFTY PER CENTUM AND NOT MORE THAN ONE 19 HUNDRED PER CENTUM OF THE CONTRACT PRICE, AS SUCH CITY MAY 20 PRESCRIBE, [HAVING AS SURETY THEREON ONE OR MORE SURETY 21 COMPANIES LEGALLY AUTHORIZED TO DO BUSINESS IN THIS 22 COMMONWEALTH,] CONDITIONED FOR THE PROMPT PAYMENT OF ALL 23 MATERIAL FURNISHED AND LABOR SUPPLIED OR PERFORMED IN THE 24 PROSECUTION OF THE WORK, WHETHER OR NOT THE SAID MATERIAL OR 25 LABOR ENTER INTO AND BECOME COMPONENT PARTS OF THE WORK OR 26 IMPROVEMENT CONTEMPLATED. SUCH ADDITIONAL [BOND] SECURITY SHALL 27 BE DEPOSITED WITH AND HELD BY THE CITY FOR THE USE OF ANY PARTY 28 INTERESTED THEREIN. EVERY SUCH ADDITIONAL [BOND] SECURITY SHALL 29 PROVIDE THAT EVERY PERSON, COPARTNERSHIP, ASSOCIATION, OR 30 CORPORATION WHO, WHETHER AS SUBCONTRACTOR OR OTHERWISE, HAS 19910H0757B3273 - 3 -
1 FURNISHED MATERIAL OR SUPPLIED OR PERFORMED LABOR IN THE 2 PROSECUTION OF THE WORK AS ABOVE PROVIDED, AND WHO HAS NOT BEEN 3 PAID THEREFOR, MAY SUE IN ASSUMPSIT ON SAID ADDITIONAL [BOND] 4 SECURITY, IN THE NAME OF THE CITY, FOR HIS, THEIR, OR ITS USE 5 AND PROSECUTE THE SAME TO FINAL JUDGMENT FOR SUCH SUM OR SUMS AS 6 MAY BE JUSTLY DUE HIM, THEM, OR IT, AND HAVE EXECUTION THEREOF: 7 PROVIDED, HOWEVER, THAT THE CITY SHALL NOT BE LIABLE FOR THE 8 PAYMENT OF ANY COSTS OR EXPENSE OF ANY SUIT. THE SURETY OR 9 SURETIES ON A BOND UNDER THIS SECTION MUST BE AUTHORIZED TO DO 10 BUSINESS IN THIS COMMONWEALTH. 11 Section 2 3. This act shall take effect in 60 days. <-- B5L11JRW/19910H0757B3273 - 4 -