Pennsylvania Act 2024-110 — BOROUGHS AND INCORPORATED TOWNS (8 PA.C.S.) - SURCHARGE BY AUDITORS, BOROUGH MANAGER CREATED BY ORDINANCE AND ELECTION, POWERS AND DUTIES, OTHER OFFICES NOT INCOMPATIBLE, ORGANIZATION OF COMMISSION AND PREPARATION OF BUDGET

Act text

Session of 2024

No. 2024-110

SB 765

AN ACT

Amending Title 8 (Boroughs and Incorporated Towns) of the Pennsylvania Consolidated Statutes, in powers and duties of elected officials, further providing for surcharge by auditors; in powers, duties and rights of appointed officers and employees, further providing for borough manager created by ordinance and election, for powers and duties, for other offices not incompatible and for organization of commission; and, in taxation and finance, further providing for preparation of budget.

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

Section 1. Sections 1059.3(a)(2), 1141, 1142, 1143, 1174(a) and 1307 of Title 8 of the Pennsylvania Consolidated Statutes are amended to read:

§ 1059.3. Surcharge by auditors.

(a) Surcharges.--

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(2) The following shall apply:

(i) No elected or appointed official of a borough may be surcharged for any act, error or omission in excess of the actual financial loss sustained by the borough.

(ii) A surcharge shall take into consideration as its basis the results of the act, error or omission and the results had the procedure been strictly in accordance with law.

(iii) Subparagraph (i) shall not apply to cases involving fraud or collusion on the part of officers nor to any penalty enuring to the benefit of or payable to the Commonwealth. Notwithstanding this section, the procedures in the act of May 25, 1945 (P.L.1050, No.394), known as the Local Tax Collection Law, shall apply to balances and shortages in the tax accounts of the tax collector.

(iv) No elected or appointed official of a borough may be surcharged if the official acted in good faith reliance on a written, nonconfidential opinion of the solicitor of the borough or on an opinion of the borough solicitor publicly stated at an open meeting of the borough and recorded in the official minutes of the meeting. This subparagraph shall not apply if a solicitor's opinion has been rendered under duress or if the parties seeking and rendering the solicitor's opinion have colluded to purposefully commit a violation of law. As used in this subparagraph, the term "solicitor" shall include a special counsel appointed by the borough for a specific matter.

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§ 1141. Borough manager created by ordinance and election.

(a) General rule.--The council of a borough may, at its discretion at any time, create by ordinance the office of borough manager and may, in like manner, abolish the office. While the office exists, the council shall, from time to time, and if there is a vacancy, elect, by a vote of a majority of all the members, one [person to fill the office.] individual, partnership, limited partnership, association or professional corporation as the borough manager.

(b) Subject to [employment] agreement.--The borough manager shall serve at the pleasure of council, subject to contractual rights that may arise under an employment agreement or professional services agreement that may be entered in accordance with section 1142 (relating to powers and duties).

§ 1142. Powers and duties.

(a) General rule.--The powers and duties of the borough manager shall be regulated by ordinance.

(b) Employment or professional services agreement.--

(1) Council may enter into an employment or professional services agreement with the borough manager that specifies the terms and conditions of employment.

(2) The employment or professional services agreement may remain in effect for a specified period terminating no later than two years after the effective date of the agreement or the date of the organizational meeting of council following the next municipal election, whichever occurs first.

(3) An employment or professional services agreement entered into under this section may specify conditions under which a borough manager who is an individual will be entitled to severance compensation[, but in no] or, in the case of a partnership, a limited partnership, an association or a professional corporation, payments for the termination of appointment. In no event may the employment or professional services agreement guarantee retention or employment through the term of the agreement or confer upon the borough manager any legal remedy based on specific performance.

(4) An employment or professional services agreement with a borough manager executed on or after a municipal election but before the first meeting in January the year after the municipal election shall be void.

(5) The council may delegate to the borough manager, by ordinance and subject to recall, any of the nonlegislative and nonjudicial powers and duties of the council, the planning commission and the shade tree commission. With approval of council, the mayor may delegate to the borough manager any of the mayor's nonlegislative and nonjudicial powers and duties.

(c) Status as public official.--The borough manager, if an individual, and, for a partnership, limited partnership, association or professional corporation appointed as the borough manager, each officer and employee directly providing services as required or authorized by the agreement shall be considered a public official for purposes of the provisions of 65 Pa.C.S. § 1103 (relating to restricted activities).

§ 1143. Other offices not incompatible.

(a) General rule.-- The offices of borough manager, street commissioner, secretary, treasurer and chief of police shall not be incompatible, and any two or more or all of the offices may be held by one person. Neither the mayor nor any member of the council shall be eligible to hold the office of borough manager.

(b) Applicability.--In the case of a partnership, limited partnership, association or professional corporation appointed as the borough manager, the restriction under subsection (a) shall apply to each officer and employee who directly provides services as required or authorized by the agreement.

§ 1174. Organization of commission.

(a) General rule.--The commission first appointed shall organize within ten days of its appointment and shall elect one of its members as the chair and one as the secretary. [The] Thereafter, the commission shall meet and organize [on] within 30 days of the first Monday of each even-numbered year. Each commissioner shall be notified in writing of each and every meeting.

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§ 1307. Preparation of budget.

[Beginning at least 30 days prior] Prior to the adoption of the budget, a proposed budget or annual estimate of revenues and expenditures for the ensuing year shall be prepared in a manner designated by the council. The proposed budget shall be kept on file with the borough secretary and be made available for public inspection by the borough secretary for a period of ten days.

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

APPROVED--The 16th day of October, A.D. 2024.

JOSH SHAPIRO