PRINTER'S NO. 890
No. 827 Session of 1993
INTRODUCED BY BIRMELIN, TRELLO, FAIRCHILD, MELIO, SCHULER,
WAUGH, SATHER, CLARK, HERSHEY, SCHEETZ, RAYMOND, GEIST,
MERRY, ADOLPH AND LEH, MARCH 22, 1993
REFERRED TO COMMITTEE ON STATE GOVERNMENT, MARCH 22, 1993
AN ACT
1 Amending the act of December 20, 1967 (P.L.869, No.385),
2 entitled "An act establishing a uniform and mandatory system
3 governing the requirement of bonds to be furnished by
4 contractors in the prosecution of any public building, or
5 other public work or public improvement, including road work;
6 the rights and remedies of persons furnishing labor or
7 material in the prosecution of such public building, public
8 work or public improvement, including road work; procedure in
9 connection with suits on payment bonds; rights of persons
10 furnishing labor or materials to a copy of bond; prescribing
11 penalties; and repealing other prior acts or provisions
12 thereof inconsistent herewith," increasing the exemption from
13 bonding requirements.
14 The General Assembly of the Commonwealth of Pennsylvania
15 hereby enacts as follows:
16 Section 1. Section 3(a) of the act of December 20, 1967
17 (P.L.869, No.385), known as the Public Works Contractors' Bond
18 Law of 1967, is amended to read:
19 Section 3. (a)--Before any contract exceeding [five thousand
20 dollars ($5,000)] ten thousand dollars ($10,000) for the
21 construction, reconstruction, alteration or repair of any public
22 building or other public work or public improvement, including
23 highway work, of any contracting body is awarded to any prime
1 contractor, such contractor shall furnish to the contracting
2 body the following bonds, which shall become binding upon the
3 awarding of said contract to such contractor:
4 (1) A performance bond at one hundred percent of the
5 contract amount, conditioned upon the faithful performance of
6 the contract in accordance with the plans, specifications and
7 conditions of the contract. Such bond shall be solely for the
8 protection of the contracting body which awarded the contract.
9 (2) A payment bond at one hundred percent of the contract
10 amount. Such bond shall be solely for the protection of
11 claimants supplying labor or materials to the prime contractor
12 to whom the contract was awarded, or to any of his
13 subcontractors, in the prosecution of the work provided for in
14 such contract, and shall be conditioned for the prompt payment
15 of all such material furnished or labor supplied or performed in
16 the prosecution of the work. "Labor or materials" shall include
17 public utility services and reasonable rentals of equipment, but
18 only for periods when the equipment rented is actually used at
19 the site.
20 * * *
21 Section 2. Section 3.1(a) of the act, added December 17,
22 1990 (P.L.694, No.171), is amended to read:
23 Section 3.1. (a)--Before any contract exceeding [five
24 thousand dollars ($5,000)] ten thousand dollars ($10,000) for
25 the construction, reconstruction, alteration or repair of any
26 public building or other public work or public improvement,
27 including highway work, of any contracting body is awarded to
28 any prime contractor, such contractor shall furnish to the
29 contracting body the following financial security, which shall
30 become binding upon the awarding of said contract to such
19930H0827B0890 - 2 -
1 contractor:
2 (1) Any financial security, acceptable to and approved by
3 the contracting body, including, but not limited to, Federal or
4 Commonwealth chartered lending institution irrevocable letters
5 of credit and restrictive or escrow accounts in such lending
6 institutions, equal to one hundred percent of the contract
7 amount, conditioned upon the faithful performance of the
8 contract in accordance with the plans, specifications and
9 conditions of the contract. Such financial security shall be
10 solely for the protection of the contracting body which awarded
11 the contract.
12 (2) Any financial security, acceptable to and approved by
13 the contracting body, including, but not limited to, Federal or
14 Commonwealth chartered lending institution irrevocable letters
15 of credit and restrictive or escrow accounts in such lending
16 institutions, equal to one hundred percent of the contract
17 amount. Such financial security shall be solely for the
18 protection of claimants supplying labor or materials to the
19 prime contractor to whom the contract was awarded, or to any of
20 his subcontractors, in the prosecution of the work provided for
21 in such contract, and shall be conditioned for the prompt
22 payment of all such material furnished or labor supplied or
23 performed in the prosecution of the work. "Labor or materials"
24 shall include public utility services and reasonable rentals of
25 equipment, but only for periods when the equipment rented is
26 actually used at the site.
27 * * *
28 Section 3. This act shall take effect in 60 days.
A25L62PJP/19930H0827B0890 - 3 -