1Amending the act of May 1, 1933 (P.L.103, No.69), entitled, as
2reenacted and amended, "An act concerning townships of the
3second class; and amending, revising, consolidating and
4changing the law relating thereto," further providing for the
5operating reserve fund.

6The General Assembly of the Commonwealth of Pennsylvania
7hereby enacts as follows:

8Section 1. Section 1508.1 of the act of May 1, 1933
9(P.L.103, No.69), known as The Second Class Township Code,
10reenacted and amended November 9, 1995 (P.L.350, No.60), is
11amended to read:

12Section 1508.1. Operating Reserve Fund.--(a) The board of
13supervisors shall have the power to create and maintain a
14separate operating reserve fund in order to minimize future
15revenue shortfalls and deficits, provide greater continuity and
16predictability in the funding of vital government services,
17minimize the need to increase taxes to balance the budget in
18times of fiscal distress, provide the capacity to undertake
19long-range financial planning and develop fiscal resources to

1meet long-term needs.

2(b) The board of supervisors may annually make
3appropriations from the general township fund to the operating
4reserve fund, but no appropriation shall be made to the
5operating reserve fund if the effect of the appropriation would
6cause the fund to exceed [five] twenty-five per centum of the
7estimated revenues of the township's general fund in the current
8fiscal year.

9(c) The board of supervisors may at any time by resolution
10make appropriations from the operating reserve fund for the
11following purposes only:

12(1) to meet emergencies involving the health, safety or
13welfare of the residents of the township;

14(2) to counterbalance potential budget deficits resulting
15from shortfalls in anticipated revenues or program receipts from
16whatever source; [or]

17(2.1) to counterbalance potential budget deficits resulting
18from increases in anticipated costs for goods or services; or

19(3) to provide for anticipated operating expenditures
20related either to the planned growth of existing projects or
21programs or to the establishment of new projects or programs if
22for each such project or program appropriations have been made
23and allocated to a separate restricted account established
24within the operating reserve fund.

25(d) The operating reserve fund shall be invested, reinvested
26and administered in a manner consistent with the provisions of
27section 3204 relating to the investment of township funds
28generally.

29Section 2. This act shall take effect in 60 days.