Pennsylvania Senators Introduce New Municipal Debt Reform Bills
June 26, 2017
Pennsylvania State Senators John Blake, John DiSanto, and Mike Folmer recently introduced a trio of new municipal debt reform bills that follow on the package of reform bills introduced in the Senate in March. The new bills – Senate Bill 694, Senate Bill 695, and Senate Bill 696 would expand the power of the Office of Attorney General to prosecute political crimes at the municipal level, increase the statute of limitations for such crimes, and require third class cities to put out for competitive bid all contracts for professional services.
Senate Bill 694, introduced by Senator Blake, would amend the Commonwealth Attorneys Act, 71 P.S. § 732-101 et seq., to authorize the Office of Attorney General to prosecute political crimes at all levels of government in the Commonwealth. Currently, section 205 of the Act authorizes OAG to prosecute in county criminal courts State officials or employees and those persons attempting to influence such State officials or employees. Under current law, OAG can only get involved in local and municipal prosecutions where there has been a direct referral of the case by the local district attorney to OAG (often due to a perceived conflict of interest).
Under Senate Bill 694, OAG would gain the power to prosecute any public official, at any level of government in the Commonwealth, for any crimes “affecting the performance of their public duties or the maintenance of the public trust.” This expansion of prosecutorial power would also extend to OAG’s ability to bring criminal charges against persons attempting to influence such officials, or benefit from such influence.
Senate Bill 695, introduced by Senator DiSanto, would amend Section 5552 of the Judicial Code, 42 Pa.C.S. § 5552, to increase the statute of limitations for crimes committed by public officers and employees. Under current law, the statute of limitations for such crimes, when committed in the course of or in connection with the public office or position, is tolled for so long as the person remains in that office or position; but in no event may the statute be extended for more than the lesser of (i) five years after the person leaves public office or employment; or (ii) eight years from the actual crime.
Senate Bill 695 would scrap the overall eight years’ limitation, and expand the limit after leaving office to eight years. Thus, a public official or employee could face prosecution at any time during the tenure of his office or employment, and up to eight years afterwards.
Senate Bill 696, introduced by Senator Folmer, would amend the public contracting provisions of the Third Class City Code to require third class cities to publicly bid for any contract involving personal or professional services. Under current law, section 11901.4 of the Third Class City Code, 11 Pa.C.S. § 11901.4, certain public contracts are exempted from the general rule that all contracts in excess of $18,500 (as adjusted for inflation) must be awarded to the lowest responsible bidder after public notice. Among the exceptions included in section 11901.4 is an exception for any contract “involving personal or professional services.” This exception has generally been interpreted broadly to apply to most service contracts, and not just the obvious ones involving attorney, accountant, engineer, and similar professional services.
Senate Bill 696 would render the “personal or professional” service exception toothless, making it applicable only to contracts that involve city employees, the city solicitor, city engineer, city administrator, deputy city treasurer or independent auditor. Unless the professional services contract was below the $18,500 monetary threshold, it would have to follow the public notice and bidding requirements specified in the Code.
Interestingly, Senate Bill 696 only applies to third class cities. It does not appear that there is any effort to make similar changes to the public contracting laws governing other municipal organizations. Time will tell whether similar proposals are introduced in the future.
Senate Bills 694, 695 and 696 were introduced in the Senate on June 12, 2017 and referred to Judiciary (SB 694 and 695) and Local Government (SB 696) Committees. It remains to be seen whether the Committees will act favorably on the proposals this year.
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