Pennsylvania Separations Act

The Pennsylvania Separations Act of 1913 requires public entity construction projects (costing more than $4,000) to solicit separate bids and award separate contracts for electrical, heating, ventilating and plumbing work.

The Commonwealth is one of just four U.S. states to continue to require the multiple prime delivery system, which critics maintain:

• creates an unnecessary fiscal and administrative burden
• does not account for changes in recent decades in the construction business, i.e. the consolidation of contractor services
• leads to cost increases, borne predominantly by local taxpayers

The Challenge:
In recent years, multiple school districts have received exemption from the multiple prime delivery system, allowing them to determine for themselves the most cost-effective approach to their projects. However, following several lawsuits, these exemptions were overturned.

The Solution:
In 2006, the Separations Modernization Initiative (SMI) advocated for House Bill 2100, which would have permitted all Pennsylvania local governments to opt out of the multiple prime project delivery system mandate. However, the bill was not voted upon before the end of the legislative session.

Recently, the Pennsylvania Economy League of Southwestern Pennsylvania surveyed school district officials about the effects of the Separations Act on school district construction projects. The study’s findings inform efforts to reduce the burden on public entities and decrease construction costs and contractual liability exposure.

Read our report: Review of Effects of the Pennsylvania Separations Act on School Districts.

With your support, as a member of the Conference Regional Investors Council, a new bill could reduce public construction costs and lower tax rates.