THE GENERAL ASSEMBLY OF PENNSYLVANIA

SENATE BILL

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

SENATOR CORMAN, APPROPRIATIONS, RE-REPORTED AS AMENDED, SEPTEMBER 20, 2011   

AN ACT

Amending the act of July 29, 1953 (P.L.1034, No.270), entitled,

as amended, "An act creating as bodies corporate and politic

"Public Auditorium Authorities" in counties of the second

class and in cities of the second class and in cities of the

second class A and counties in which a city of the second

class A is located, singly or jointly; prescribing the

rights, powers and duties of such Authorities; authorizing

such Authorities to acquire, construct, improve, maintain and

operate public auditoriums; to borrow money and issue bonds

therefor; providing for the payment of such bonds and

prescribing the rights of the holders thereof; conferring the

right of eminent domain on such Authorities; empowering such

Authorities to enter into contracts, leases and licenses with

and to accept grants from private sources, the Federal

Government, State, political subdivisions of the State or any

agency thereof; authorizing the making of said grants from

bond funds or current revenues; authorizing Authorities to

collect rentals, admissions, license fees for the use of the

project; exempting the property and securities of such Public

Auditorium Authorities from taxation," increasing the dollar

amount of supplies and materials which may be purchased

without advertising.

The General Assembly of the Commonwealth of Pennsylvania

hereby enacts as follows:

Section 1.  Section 11 of the act of July 29, 1953 (P.L.1034,

No.270), known as the Public Auditorium Authorities Law, amended

July 10, 1990 (P.L.376, No.88), is amended to read:

Section 11.  Competition in Award of Contracts.

A.  All construction, reconstruction, repairs or work of any

nature made by any Authority, where the entire cost, value or

amount of such construction, reconstruction, repairs or work,

including labor and materials, shall exceed [ten thousand

dollars ($10,000)] twenty-five thousand dollars ($25,000) the

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base amount of eighteen thousand five hundred dollars ($18,500),

subject to adjustment under subsection I, except construction,

reconstruction, repairs or work done by employes of said

Authority or by labor supplied under agreement with any Federal

or State agency with supplies and materials purchased, as

hereinafter provided, shall be done only under contract or

contracts to be entered into by the Authority with the lowest

responsible bidder upon proper terms, after due public notice

has been given asking for competitive bids hereinafter provided.

No contract shall be entered into for construction or

improvement or repair of any project or portion thereof unless

the contractor shall give an undertaking, with a sufficient

surety or sureties approved by the Authority and in an amount

fixed by the Authority, for the faithful performance of the

contract. All such contracts shall provide, among other things,

that the person or corporation entering into such contract with

the Authority will pay for all materials furnished and services

rendered for the performance of the contract and that any person

or corporation furnishing such materials or rendering such

services may maintain an action to recover for the same against

the obligor in the undertaking as though such person or

corporation was named therein, provided the action is brought

within one year after the time the cause of action accrued.

Nothing in this section shall be construed to limit the power of

the Authority to construct, repair or improve any project or

portion thereof or any addition, betterment or extension thereto

directly by the officers, agents and employes of the Authority

or otherwise than by contract.

B.  All supplies and materials costing [ten thousand dollars

($10,000)], subject to adjustment under subsection I, twenty-

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five thousand dollars ($25,000) in excess of the base amount of

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eighteen thousand five hundred dollars ($18,500) or more shall

be purchased only after due advertisement as hereinafter

provided. The Authority shall accept the lowest bid or bids,

kinds, quality and material being equal, but the Authority shall

have the right to reject any or all bids or select a single item

from any bid. The provisions as to bidding shall not apply to

the purchase of patented and manufactured products offered for

sale in a non-competitive market or solely by a manufacturer's

authorized dealer.

B.1.  Written or telephonic price quotations from at least

three (3) qualified and responsible contractors shall be

requested for all contracts that exceed [four thousand dollars

($4,000)] seven thousand dollars ($7,000) the base amount of ten

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thousand dollars ($10,000), subject to adjustment under

subsection I, 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 (3) 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 (3) years.

C.  The terms, advertisement or due public notice, wherever

used in this section, shall mean a notice published at least ten

(10) days before the award on any contract in a newspaper of

general circulation published in the municipality where the

Authority has its principal office, and if no newspaper is

published therein then by publication in a newspaper in the

county where the Authority has its principal office: Provided,

That such notice may be waived where the Authority determines an

emergency exists and such supplies and materials must be

immediately purchased by the said Authority.

D.  No member of the Authority or officer or employe thereof

shall, either directly or indirectly, be a party to or be in any

manner interested in any contract or agreement with the

Authority for any matter, cause or thing whatsoever, by reason

whereof any liability or indebtedness shall in any way be

created against such Authority. If any contract or agreement

shall be made in violation of the provision of this section, the

same shall be null and void and no action shall be maintained

thereon against such Authority.

E.  Subject to the aforesaid, any Authority may (but without

intending by this provision to limit any powers of such

Authority) enter into and carry out such contracts or establish

or comply with such rules and regulations concerning labor and

materials and other related matters, in connection with any

project or portion thereof, as the Authority may deem desirable,

or as may be requested by any Federal agency that may assist in

the financing of such project or any part thereof: Provided,

however, That the provisions of this section shall not apply to

any case in which the Authority has taken over by transfer or

assignment any contract authorized to be assigned to it under

the provisions of section ten of this act, nor to any contract

in connection with the construction of any project which the

Authority may have had transferred to it by any person or

private corporation.

F.  Every contract for the construction, reconstruction,

alteration, repair, improvement or maintenance of public works

shall comply with the provisions of the act of March 3, 1978

(P.L.6, No.3), known as the "Steel Products Procurement Act."

G.  An Authority shall not evade the provisions of this

section as to advertising for bids or purchasing materials or

contracting for services piecemeal for the purpose of obtaining

prices under [ten thousand dollars ($10,000)] twenty-five

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thousand dollars ($25,000) the base amount of eighteen thousand

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five hundred dollars ($18,500), subject to adjustment under

subsection I, upon transactions which should, in the exercise of

reasonable discretion and prudence, be conducted as one

transaction amounting to more than [ten thousand dollars

($10,000)] twenty-five thousand dollars ($25,000) the base

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amount of eighteen thousand five hundred dollars ($18,500),

subject to adjustment under subsection I. This provision is

intended to make unlawful the practice of evading 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 transaction involved should have

been made as one transaction for one price.

H.  Any member of the Authority who votes to unlawfully evade

the provisions of this section 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.

I.  (1)  Every five years, beginning with the year in which

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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 twelve-month average ending

in September of the preceding five-year period.

(2)  The amounts at which competitive bidding and written or

telephonic price quotations are required under this section

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,

B or G for the current five-year period and the product thereof

shall be added to the amount applicable under subsection A, B or

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

the nearest multiple of one hundred dollars ($100).

(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 B.1 for the current five-year period and the product

thereof shall be added to the amount applicable under subsection

B.1 for the current five-year period, with the result rounded to

the nearest multiple of one hundred dollars ($100).

(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

annually 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 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 and written or telephonic price quotations are required

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

after publication of the notice.

I.  Adjustments to the base amounts specified under

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subsections A, B, B.1 and G shall be made as follows:

(1)  The Department of Labor and Industry shall determine the

percentage change in the All Items Consumer Price Index for All

Urban Consumers (CPI-U) for the United States City Average as

published by the United States Department of Labor, Bureau of

Labor Statistics for the twelve-month period ending September

30, 2012, and for each successive twelve-month period

thereafter.

(2)  If the department determines that there is no positive

percentage change, then no adjustment to the base amounts shall

occur for the relevant time period provided for in this

subsection.

(3)  (i)  If the department determines that there is a

positive percentage change in the first year that the

determination is made under clause (1), the positive percentage

change shall be multiplied by each base amount and the products

shall be added to the base amounts, respectively, and the sums

shall be preliminary adjusted amounts.

(ii)  The preliminary adjusted amounts shall be rounded to

the nearest one thousand dollars ($1,000), to determine the

final adjusted base amounts for purposes of subsections A, B,

B.1 and G.

(4)  In each successive year in which there is a positive

percentage change in the CPI-U for the United States City

Average, the positive percentage change shall be multiplied by

the most recent preliminary adjusted amounts and the products

shall be added to the preliminary adjusted amount of the prior

year to calculate the preliminary adjusted amounts for the

current year. The sums thereof shall be rounded to the nearest

one thousand dollars ($1,000) to determine the new final

adjusted base amounts for purposes of subsections A, B, B.1 and

G.

(5)  The determinations and adjustments required under this

subsection shall be made in the period between October 1 and

November 15 of the year following the effective date of this

subsection, and annually between October 1 and November 15 of

each year thereafter.

(6)  The final adjusted base amounts and new final adjusted

base amounts obtained under clauses (3) and (4) shall become

effective January 1 for the calendar year following the year in

which the determination required under clause (1) is made.

(7)  The department shall publish notice in the Pennsylvania

Bulletin prior to January 1 of each calendar year of the annual

percentage change determined under clause (1) and the unadjusted

or final adjusted base amounts determined under clauses (3) and

(4) at which competitive bidding is required under subsections

A, B and G and written or telephonic price quotations are

required under subsection B.1, respectively, for the calendar

year beginning the first day of January after publication of the

notice. The notice shall include a written and illustrative

explanation of the calculations performed by the department in

establishing the unadjusted or final adjusted base amounts under

this subsection for the ensuing calendar year.

(8)  No adjustment to the base amounts specified under

subsections A, B, B.1 and G shall exceed three percent of the

most recently adjusted base amount.

Section 2.  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 3.  This act shall take effect in 60 days.