An Act amending the act of July 10, 1987 (P.L.246, No.47), known as the Municipalities Financial Recovery Act, in receivership in municipalities, further providing for powers, duties and prohibited actions.

PRINTER'S NO. 491
THE GENERAL ASSEMBLY OF PENNSYLVANIA
HOUSE BILL
No. 509
Session of
2025
INTRODUCED BY KAZEEM, GIRAL, SANCHEZ, FIEDLER, KHAN, HILL-EVANS,
CIRESI, OTTEN, KENYATTA, DEASY, O'MARA, GREEN AND GILLEN,
FEBRUARY 5, 2025
REFERRED TO COMMITTEE ON LOCAL GOVERNMENT, FEBRUARY 5, 2025
AN ACT
Amending the act of July 10, 1987 (P.L.246, No.47), entitled "An
act empowering the Department of Community and Economic
Development to assist municipalities in avoiding financial
distress; declare certain municipalities as financially
distressed; providing for the restructuring of debt of
financially distressed municipalities; limiting the ability
of financially distressed municipalities to obtain government
funding; authorizing municipalities to participate in Federal
debt adjustment actions and bankruptcy actions under certain
circumstances; authorizing certain taxes; and providing for
the disincorporation of municipalities and the establishment
of unincorporated service districts," in receivership in
municipalities, further providing for powers, duties and
prohibited actions.
The General Assembly of the Commonwealth of Pennsylvania
hereby enacts as follows:
Section 1. Section 706(a)(5) of the act of July 10, 1987
(P.L.246, No.47), known as the Municipalities Financial Recovery
Act, is amended to read:
Section 706. Powers, duties and prohibited actions.
(a) Powers and duties.--Notwithstanding any other provision
of law, the receiver shall have the following powers and duties:
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(5) To require the distressed municipality or authority
to cause the sale, lease, conveyance, assignment or other use
or disposition of the distressed municipality's or
authority's assets in accordance with section 707[.],
provided that the distressed municipality and receiver obtain
approval from 75% of the governing bodies of municipalities
which have service agreements with or whose residents
previously received water or sewer services, or both, from
the distressed municipality or authority prior to the sale,
lease, conveyance, assignment or other use or disposition of
the distressed municipality's or authority's assets.
Municipal approval shall be as follows:
(i) T he approval must be in the form of a
resolution.
(ii) The resolution must be adopted at a public
meeting by an affirmative vote of a majority of the
members of the governing body of the municipality.
(iii) The result of an affirmative vote must be
transmitted to the distressed municipality and receiver
within 48 hours of the vote.
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Section 2. This act shall take effect in 60 days.
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