New Law - Act 18 of 2022 (Public Contract Bid Nonreceipt Act)
Introduced as SB 478 (Senator Cris Dush - Cameron, Clearfield, Clinton, Elk, Jefferson, McKean, Potter and Tioga Counties) received final passage in the House (Vote Y: 197/N: 1) on April 13th and was approved by the governor on April 19th (Act 18-2022). It amends Act 78 of 1979 authorizing political subdivisions and municipal authorities to enter into contracts for services when two consecutive advertisements fail to induce bids. If no bids are received within 15 days of the second advertisement, the authority may initiate negotiations for a contract for services with any provider not otherwise disqualified by law. The law becomes effective June 18,2022.
Other recent laws, click here.
Municipality Authorities Act – Governing Act of municipal authorities in the Commonwealth of Pennsylvania.
Latest changes to the Municipality Authorities Act
HB 264 (Act 4-2019) establishes best financial practices, specifically monies collected by the authority are deposited into a designated account, remitted in the name of the authority or designated recipient (not the name of an individual) and the bill also requires an authority to establish procedures for the billing and collection of monies.
In addition, the bill extends the time requirement for submission of an authority’s annual financial report to the Department of Community and Economic Development (DCED). No matter when an authority’s fiscal year ends, it has 180 days to submit the report to DCED. PMAA had this amendment, to extend the time for filing with DCED, added to several bills for several sessions, and was successful in having it reach final passage in this bill.
HB 1203 (Act 99-2019) requires authorities to comply with a set of standard guidelines when completing their annual audit. It also gives the incorporating municipality of an authority the ability to conduct an independent financial audit of the authority with the assistance of the Auditor General only if the authority fails to complete their annual audit. Below is an outline detailing the changes to the MAA:
Changes “General Accountability Office” to “Government Accountability Office” and adds “if applicable” to the standards required under §5612(b)(2).
Permits a municipality to conduct a review of the authority’s accounts and books, including the authority’s receipts, billing systems, disbursements, transparency of contracts and the processes by which they are awarded, sinking funds, investments, compliance with relevant Federal and State statutes, conflicts of interests by the authority, its board members, staff, and contractors, and any other matters relating to its finances, operation and affairs.
Adds language that if the municipality conducts a review within a year of an authority’s annual audit, the review shall be done at the expense of the municipality and the authority is exempt from submitting an audit required under §5612(b)(2) the following fiscal year. If a review is done because the authority failed to produce an audit as provided in §5612(b)(4), the review shall be at the expense of the authority.
Bidding Thresholds Increase (Effective Jan. 1, 2023)
The Pennsylvania Department of Labor & Industry published the authority and municipal bidding thresholds for 2023. Under Act 90 of 2011, the bidding thresholds provide for an annual inflation adjustment based on the Consumer Price Index for All Urban Consumers.
The percentage change for the 12-month period ending September 30, 2022, is 8.2%. PLEASE NOTE: The law (Act 90 of 2011) caps an increase at a maximum of 3%.
Beginning January 1, 2023, the bidding thresholds for municipal authorities will be as follows:
Purchases and contracts below $12,200 require no formal bidding or written/telephonic quotations.
Purchases and contracts between $12,200 and $22,500 require three written/telephonic quotations.
Purchases and contracts over $22,500 require formal bidding.
Click here to view the Pennsylvania Bulletin announcement (December 10, 2022, edition) and for the specifics of the CPI adjustment.
Tapping Fees Information & Resources:
The section of the Municipality Authorities Act on Tapping Fees is found in Section 5607(d) (24) –(33)].
Tapping Fees Overview (based on latest amendments in the law, Act 57-2003)
Sample Calculations (based on latest amendments in the law, Act 57-2003)
Qs & As
Tapping Fees Resolution