HOUSE AMENDED

THE GENERAL ASSEMBLY OF PENNSYLVANIA

SENATE BILL

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

AS REPORTED FROM COMMITTEE ON LOCAL GOVERNMENT, HOUSE OF REPRESENTATIVES, AS AMENDED, OCTOBER 4, 2011   

AN ACT

Amending the act of June 24, 1931 (P.L.1206, No.331), entitled

"An act concerning townships of the first class; amending,

revising, consolidating, and changing the law relating

thereto," further providing for contracts and acquisition of

property and for general regulations concerning contracts.

The General Assembly of the Commonwealth of Pennsylvania

hereby enacts as follows:

Section 1.  Section 1802(a) and (a.1) of the act of June 24,

<--

1931 (P.L.1206, No.331), known as The First Class Township Code,

reenacted and amended May 27, 1949 (P.L.1955, No.569) and

amended or added July 10, 1990 (P.L.389, No.92) and December 20,

1996 (P.L.1495, No.192), are amended and the section is amended

by adding a subsection to read:

Section 1.  Section 1802(a), (a.1) and (d)(2) of the act of

<--

June 24, 1931 (P.L.1206, No.331), known as The First Class

Township Code, reenacted and amended May 27, 1949 (P.L.1955,

No.569) and amended or added July 10, 1990 (P.L.389, No.92),

December 18, 1996 (P.L.1149, No.173) and December 20, 1996

(P.L.1495, No.192), are amended and the section is amended by

adding a subsection to read:

Section 1802.  General Regulations Concerning Contracts.--(a)

All contracts or purchases made by any township, involving the

expenditure of over [ten thousand dollars] the base amount of

eighteen thousand five hundred dollars subject to adjustment

under subsection (a.2), except those hereinafter mentioned,

shall not be made except with and from the lowest responsible

bidder, shall be in writing, and shall be made only after notice

by the secretary, published, in one newspaper of general

circulation, published or circulating in the county in which the

township is situated, at least two times at intervals of not

less than three days where daily newspapers of general

circulation are employed for such publication, or in case weekly

newspapers are employed then the notice shall be published once

a week for two successive weeks. The first advertisement shall

be published not more than forty-five days and the second

advertisement not less than ten days prior to the date fixed for

the opening of bids. Advertisements for contracts or purchases

shall also be posted in a conspicuous place within the township.

Advertisements for contracts or purchases shall contain the

date, time and location for opening of bids and shall state the

amount of the performance bond determined under subsection (c).

All plans and specifications shall be on file at least ten days

in advance of opening bids. The amount of the contract shall in

all cases, whether of straight sale price, conditional sale,

bailment lease, or otherwise, be the entire amount which the

township pays to the successful bidder or his assigns in order

to obtain the services or property, or both, and shall not be

construed to mean only the amount which is paid to acquire title

or to receive any other particular benefit or benefits of the

whole bargain.

(a.1)  Written or telephonic price quotations from at least

three qualified and responsible contractors shall be requested

for all contracts [that exceed four thousand dollars] in excess

of the base amount of ten thousand dollars subject to adjustment

under subsection (a.2) 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 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 years.

(a.2)  Adjustments to the base amounts specified under

subsection (a) subsections (a) and (a.1) 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 paragraph (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 hundred dollars, to determine the final adjusted

base amounts for purposes of subsection (a).

(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 hundred dollars to determine the new final adjusted base

amounts for purposes of subsection (a).

(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 paragraphs (3) and (4) shall become

effective January 1 for the calendar year following the year in

which the determination required under paragraph (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 paragraph (1) and the

unadjusted or final adjusted base amounts determined under

paragraphs (3) and (4) at which competitive bidding is required

under subsection (a) subsections (a) and (a.1) 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)  The annual increase in the preliminary adjusted base

amounts obtained under paragraphs (3) and (4) shall not exceed

three per centum.

* * *

Section 2.  Section 1802.1 of the act, amended July 10, 1990

<--

(P.L.389, No.92), is amended to read:

(d)  The contracts or purchases made by the commissioners

<--

which shall not require advertising, bidding or price

quotations, as hereinbefore provided, are as follows:

* * *

(2)  Those made for improvements, repairs and maintenance of

any kind made or provided by any township through its own

employes: Provided, however, That all materials used for street

improvement, maintenance, and/or construction in excess of [four

thousand] the base amount of eighteen thousand five hundred 

dollars be subject to the relevant price quotation or

advertising requirements as contained herein and to adjustment

under subsection (a.2).

* * *

Section 2.  Sections 1802.1 and 1805 of the act, amended July

10, 1990 (P.L.389, No.92), are amended to read:

Section 1802.1.  Evasion of Advertising Requirements.--(a)

No commissioner or commissioners shall evade the provisions of

section one thousand eight hundred two as to advertising for

bids, by purchasing or contracting for services and personal

properties piecemeal for the purpose of obtaining prices under

[ten thousand dollars] the base amount of eighteen thousand five

<--

hundred dollars subject to adjustment under section 1802(a.2) 

upon transactions, which transactions should, in the exercise of

reasonable discretion and prudence, be conducted as one

transaction amounting to more than [ten thousand dollars] the

<--

base amount of eighteen thousand five hundred dollars subject to

adjustment under section 1802(a.2). This provision is intended

to make unlawful the evading of 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 transactions involved should have been made as one

transaction for one price. Any commissioners who so vote in

violation of this provision, and who know that the transaction

upon which they so vote 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, shall be jointly and

severally subject to surcharge for ten per centum of the full

amount of the contract or purchase. Whenever it shall appear

that a commissioner may have voted in violation of this section,

but the purchase or contract on which he so voted was not

approved by the board of commissioners, this section shall be

inapplicable.

(b)  Any commissioner who votes to unlawfully evade the

provisions of section one thousand eight hundred two 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. This penalty shall

be in addition to any surcharge which may be assessed pursuant

to subsection (a).

Section 1805.  Separate Specifications for Branches of

<--

Work.--In the preparation of specifications for the erection or

alteration of any public building, when the entire cost of such

work exceeds [ten thousand dollars] the base amount of eighteen

thousand five hundred dollars subject to adjustment under

section 1802(a.2), the architect, engineer, or person preparing

such specifications shall prepare separate specifications for

the plumbing, heating, ventilating, and electrical work, and the

township shall receive separate bids upon each of such branches

of work, and award the contract for the same to the lowest

responsible bidder.

Section 3.  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 4.  This act shall take effect immediately.