5607 - Purposes and powers.

     § 5607.  Purposes and powers.        (a)  Scope of projects permitted.--Every authority     incorporated under this chapter shall be a body corporate and     politic and shall be for the purposes of financing working     capital; acquiring, holding, constructing, financing, improving,     maintaining and operating, owning or leasing, either in the     capacity of lessor or lessee, projects of the following kind and     character and providing financing for insurance reserves:            (1)  Equipment to be leased by an authority to the        municipality or municipalities that organized it or to any        municipality or school district located wholly or partially        within the boundaries of the municipality or municipalities        that organized it.            (2)  Buildings to be devoted wholly or partially for        public uses, including public school buildings, and        facilities for the conduct of judicial proceedings and for        revenue-producing purposes.            (3)  Transportation, marketing, shopping, terminals,        bridges, tunnels, flood control projects, highways, parkways,        traffic distribution centers, parking spaces, airports and        all facilities necessary or incident thereto.            (4)  Parks, recreation grounds and facilities.            (5)  Sewers, sewer systems or parts thereof.            (6)  Sewage treatment works, including works for treating        and disposing of industrial waste.            (7)  Facilities and equipment for the collection, removal        or disposal of ashes, garbage, rubbish and other refuse        materials by incineration, landfill or other methods.            (8)  Steam heating plants and distribution systems.            (9)  Incinerator plants.            (10)  Waterworks, water supply works, water distribution        systems.            (11)  Facilities to produce steam which is used by the        authority or is sold on a contract basis for industrial or        similar use or on a sale-for-resale basis to one or more        entities authorized to sell steam to the public, provided        that such facilities have been approved by resolution or        ordinance adopted by the governing body of the municipality        or municipalities organizing such authority and that the        approval does not obligate the taxing power of the        municipality in any way.            (12)  Facilities for generating surplus electric power        which are related to incinerator plants, dams, water supply        works, water distribution systems or sewage treatment plants        pursuant, where applicable, to section 3 of the Federal Power        Act (41 Stat. 1063, 16 U.S.C. § 796) and section 210 of the        Public Utility Regulatory Policies Act of 1978 (Public Law        95-617, 16 U.S.C. § 824a-3) or Title IV of the Public Utility        Regulatory Policies Act of 1978 (Public Law 95-617, 16 U.S.C.        §§ 2701 to 2708) if:                (i)  electric power generated from the facilities is            sold or distributed only on a sale-for-resale basis to            one or more entities authorized to sell electric power to            the public;                (ii)  the facilities have been approved by resolution            or ordinance adopted by the governing body of the            municipality or municipalities organizing the authority            and the approval does not obligate the taxing power of            the municipality in any way; and                (iii)  the incinerator plants, dams, water supply            works, water distribution systems or sewage treatment            plants are or will be located within or contiguous with a            county in which at least one of the municipalities            organizing the authority is located, except that this            subparagraph shall not apply to incinerator plants, dams,            water supply works, water distribution systems or sewage            treatment plants located in any county which have been or            will be constructed by or acquired by the authority to            perform functions the primary purposes of which are other            than that of generation of electric power for which the            authority has been organized.            (13)  Swimming pools, playgrounds, lakes and low-head        dams.            (14)  Hospitals and health centers.            (15)  Buildings and facilities for private, nonprofit,        nonsectarian secondary schools, colleges and universities,        State-related universities and community colleges, which are        determined by the authority to be eligible educational        institutions, provided that such buildings and facilities        shall have been approved by resolution or ordinance adopted        by the governing body of the municipality or municipalities        organizing the authority and that the approval does not        obligate the taxing power of the governing body in any way.            (16)  Motor buses for public use, when such motor buses        are to be used within any municipality, and subways.            (17)  Industrial development projects, including, but not        limited to, projects to retain or develop existing industries        and the development of new industries, the development and        administration of business improvements and administrative        services related thereto.        (b)  Limitations.--This section is subject to the following     limitations:            (1)  An authority created by a school district or school        districts shall have the power only to acquire, hold,        construct, improve, maintain, operate and lease public school        buildings and other school projects acquired, constructed or        improved for public school purposes.            (2)  The purpose and intent of this chapter being to        benefit the people of the Commonwealth by, among other        things, increasing their commerce, health, safety and        prosperity and not to unnecessarily burden or interfere with        existing business by the establishment of competitive        enterprises, none of the powers granted by this chapter shall        be exercised in the construction, financing, improvement,        maintenance, extension or operation of any project or        projects or providing financing for insurance reserves which        in whole or in part shall duplicate or compete with existing        enterprises serving substantially the same purposes. This        limitation shall not apply to the exercise of the powers        granted under this section:                (i)  for facilities and equipment for the collection,            removal or disposal of ashes, garbage, rubbish and other            refuse materials by incineration, landfill or other            methods if each municipality organizing or intending to            use the facilities of an authority having such powers            shall declare by resolution or ordinance that it is            desirable for the health and safety of the people of such            municipality that it use the facilities of the authority            and state if any contract between such municipality and            any other person, firm or corporation for the collection,            removal or disposal of ashes, garbage, rubbish and other            refuse material has by its terms expired or is terminable            at the option of the municipality or will expire within            six months from the date such ordinance becomes            effective;                (ii)  for industrial development projects if the            authority does not develop industrial projects which will            compete with existing industries;                (iii)  for authorities created for the purpose of            providing business improvements and administrative            services if each municipality organizing an authority for            such a project shall declare by resolution or ordinance            that it is desirable for the entire local government unit            to improve the business district;                (iv)  to hospital projects or health centers to be            leased to or financed with loans to public hospitals,            nonprofit corporation health centers or nonprofit            hospital corporations serving the public or to school            building projects and facilities to be leased to or            financed with loans to private, nonprofit, nonsectarian            secondary schools, colleges and universities, State-            related universities and community colleges or to            facilities, as limited under the provisions of this            section, to produce steam or to generate electric power            if each municipality organizing an authority for such a            project shall declare by resolution or ordinance that it            is desirable for the health, safety and welfare of the            people in the area served by such facilities to have such            facilities provided by or financed through an authority;                (v)  to provide financing for insurance reserves if            each municipality or authority intending to use any            proceeds thereof shall declare by resolution or ordinance            that it is desirable for the health, safety and welfare            of the people in such local government unit or served by            such authority; or                (vi)  to projects for financing working capital.            (3)  It is the intent of this chapter in specifying and        defining the authorized purposes and projects of an authority        to permit the authority to benefit the people of this        Commonwealth by, among other things, increasing their        commerce, health, safety and prosperity while not        unnecessarily burdening or interfering with any municipality        which has not incorporated or joined that authority.        Therefore, notwithstanding any other provisions of this        chapter, an authority shall not have as its purpose and shall        not undertake as a project solely for revenue-producing        purposes the acquiring of buildings, facilities or tracts of        land which in the case of an authority incorporated or joined        by a county or counties are located either within or outside        the boundaries of the county or counties and in the case of        all other authorities are located outside the boundaries of        the municipality or municipalities that incorporated or        joined the authority unless either:                (i)  the governing body of each municipality in which            the project will be undertaken has by resolution            evidenced its approval; or                (ii)  in cases where the property acquired is not            subject to tax abatement, the authority covenants and            agrees with each municipality in which the authority will            acquire real property as part of the project either to            make annual payments in lieu of real estate taxes and            special assessments for amounts and time periods            specified in the agreement or to pay annually the amount            of real estate taxes and special assessments which would            be payable if the real property so acquired were fully            taxable and subject to special assessments.        (c)  Effect of specificity.--The municipality or     municipalities organizing such an authority may, in the     resolution or ordinance signifying their intention so to do or     from time to time by subsequent resolution or ordinance, specify     the project or projects to be undertaken by the authority, and     no other projects shall be undertaken by the authority than     those so specified. If the municipal authorities organizing an     authority fail to specify the project or projects to be     undertaken, then the authority shall be deemed to have all the     powers granted by this chapter.        (d)  Powers.--Every authority may exercise all powers     necessary or convenient for the carrying out of the purposes set     forth in this section, including, but without limiting the     generality of the foregoing, the following rights and powers:            (1)  To have existence for a term of 50 years and for        such further period or periods as may be provided in articles        of amendment approved under section 5605(e) (relating to        amendment of articles).            (2)  To sue and be sued, implead and be impleaded,        complain and defend in all courts.            (3)  To adopt, use and alter at will a corporate seal.            (4)  To acquire, purchase, hold, lease as lessee and use        any franchise, property, real, personal or mixed, tangible or        intangible, or any interest therein necessary or desirable        for carrying out the purposes of the authority, and to sell,        lease as lessor, transfer and dispose of any property or        interest therein at any time acquired by it.            (5)  To acquire by purchase, lease or otherwise and to        construct, improve, maintain, repair and operate projects.            (6)  To finance projects by making loans which may be        evidenced by and secured as may be provided in loan        agreements, mortgages, security agreements or any other        contracts, instruments or agreements, which contracts,        instruments or agreements may contain such provisions as the        authority shall deem necessary or desirable for the security        or protection of the authority or its bondholders.            (7)  To make bylaws for the management and regulation of        its affairs.            (8)  To appoint officers, agents, employees and servants,        to prescribe their duties and to fix their compensation.            (9)  To fix, alter, charge and collect rates and other        charges in the area served by its facilities at reasonable        and uniform rates to be determined exclusively by it for the        purpose of providing for the payment of the expenses of the        authority, the construction, improvement, repair, maintenance        and operation of its facilities and properties and, in the        case of an authority created for the purpose of making        business improvements or providing administrative services, a        charge for such services which is to be based on actual        benefits and which may be measured on, among other things,        gross sales or gross or net profits, the payment of the        principal of and interest on its obligations and to fulfill        the terms and provisions of any agreements made with the        purchasers or holders of any such obligations, or with a        municipality and to determine by itself exclusively the        services and improvements required to provide adequate, safe        and reasonable service, including extensions thereof, in the        areas served. If the service area includes more than one        municipality, the revenues from any project shall not be        expended directly or indirectly on any other project unless        such expenditures are made for the benefit of the entire        service area. Any person questioning the reasonableness or        uniformity of a rate fixed by an authority or the adequacy,        safety and reasonableness of the authority's services,        including extensions thereof, may bring suit against the        authority in the court of common pleas of the county where        the project is located or, if the project is located in more        than one county, in the court of common pleas of the county        where the principal office of the project is located. The        court of common pleas shall have exclusive jurisdiction to        determine questions involving rates or service. Except in        municipal corporations having a population density of 300        persons or more per square mile, all owners of real property        in eighth class counties may decline in writing the services        of a solid waste authority.            (10)  In the case of an authority which has agreed to        provide water service through a separate meter and separate        service line to a residential dwelling unit in which the        owner does not reside, to impose and enforce the owner's duty        to pay a tenant's bill for service rendered to the tenant by        the authority only if the authority notifies the owner and        the tenant within 30 days after the bill first becomes        overdue. Notification shall be provided by first class mail        to the address of the owner provided to the authority by the        owner and to the billing address of the tenant, respectively.        Nothing in this paragraph shall be construed to require an        authority to terminate service to a tenant, and the owner        shall not be liable for any service which the authority        provides to the tenant 90 or more days after the tenant's        bill first becomes due unless the authority has been        prevented by court order from terminating service to that        tenant.            (11)  In the case of an authority which has agreed to        provide sewer service to a residential dwelling unit in which        the owner does not reside, to impose and enforce the owner's        duty to pay a tenant's bill for service rendered by the        authority to the tenant. The authority shall notify the owner        and the tenant within 30 days after the tenant's bill for        that service first becomes overdue. Notification shall be        provided by first class mail to the address of the owner        provided to the authority by the owner and to the billing        address of the tenant, respectively. Nothing in this        paragraph shall be construed to relieve the owner of        liability for such service unless the authority fails to        provide the notice required in this paragraph.            (12)  To borrow money, make and issue negotiable notes,        bonds, refunding bonds and other evidences of indebtedness or        obligations, hereinafter called bonds, of the authority.        Bonds shall have a maturity date not longer than 40 years        from the date of issue except that no refunding bonds shall        have a maturity date later than the life of the authority;        also, to secure the payment of the bonds or any part thereof        by pledge or deed of trust of all or any of its revenues and        receipts; to make agreements with the purchasers or holders        of the bonds or with others in connection with any bonds,        whether issued or to be issued, as the authority shall deem        advisable; and in general to provide for the security for the        bonds and the rights of the bondholders. In respect to any        project constructed and operated under agreement with any        authority or any public authority of any adjoining state, to        borrow money and issue notes, bonds and other evidences of        indebtedness and obligations jointly with that authority.        Notwithstanding any of the foregoing, no authority shall        borrow money on obligations to be paid primarily out of lease        rentals or other current revenues other than charges made to        the public for the use of the capital projects financed if        the net debt of the lessee municipality or municipalities        shall exceed any limit provided by any law of the        Commonwealth.            (13)  To make contracts of every name and nature and to        execute all instruments necessary or convenient for the        carrying on of its business.            (14)  Without limitation of the foregoing, to borrow        money and accept grants from and to enter into contracts,        leases or other transactions with any Federal agency, the        Commonwealth or a municipality, school district, corporation        or authority.            (15)  To have the power of eminent domain.            (16)  To pledge, hypothecate or otherwise encumber all or        any of the revenues or receipts of the authority as security        for all or any of the obligations of the authority.            (17)  To do all acts and things necessary or convenient        for the promotion of its business and the general welfare of        the authority to carry out the powers granted to it by this        chapter or other law, including, but not limited to, the        adoption of reasonable rules and regulations that apply to        water and sewer lines located on a property owned or leased        by a customer and to refer for prosecution as a summary        offense any violation dealing with rules and regulations        relating to water and sewer lines located on a property owned        or leased by a customer. Under this paragraph, an authority        established by a county of the second class A which is not a        home rule county shall have powers for the inspection and        repair of sewer facilities comparable to the powers of health        officials under section 3007 of the act of May 1, 1933        (P.L.103, No.69), known as The Second Class Township Code.            (18)  To contract with any municipality, corporation or a        public authority of this and an adjoining state on terms as        the authority shall deem proper for the construction and        operation of any project which is partly in this Commonwealth        and partly in the adjoining state.            (19)  To enter into contracts to supply water and other        services to and for municipalities that are not members of        the authority or to and for the Commonwealth, municipalities,        school districts, persons or authorities and fix the amount        to be paid therefor.            (20)  (i)  To make contracts of insurance with an            insurance company, association or exchange authorized to            transact business in this Commonwealth, insuring its            employees and appointed officers and officials under a            policy or policies of insurance covering life, accidental            death and dismemberment and disability income. Statutory            requirements for such insurance, including, but not            limited to, requisite number of eligible employees,            appointed officers and officials, as provided for in            section 621.2 of the act of May 17, 1921 (P.L.682,            No.284), known as The Insurance Company Law of 1921, and            sections 1, 2, 6, 7 and 9 of the act of May 11, 1949            (P.L.1210, No.367), known as the Group Life Insurance            Policy Law, shall be met.                (ii)  To make contracts with an insurance company,            association or exchange or any hospital plan corporation            or professional health service corporation authorized to            transact business in this Commonwealth insuring or            covering its employees and their dependents but not its            appointed officers and officials nor their dependents for            hospital and medical benefits and to contract for its            employees but not its appointed officers and officials            with an insurance company, association or exchange            authorized to transact business in this Commonwealth            granting annuities or to establish, maintain, operate and            administer its own pension plan covering its employees            but not its appointed officers and officials.                (iii)  For the purposes set forth under this            paragraph, to agree to pay part or all of the cost of            this insurance, including the premiums or charges for            carrying these contracts, and to appropriate out of its            treasury any money necessary to pay such costs, premiums            or charges. The proper officers of the authority who are            authorized to enter into such contracts are authorized,            enabled and permitted to deduct from the officers' or            employees' pay, salary or compensation that part of the            premium or cost which is payable by the officer or            employee and as may be so authorized by the officer or            employee in writing.            (21)  To charge the cost of construction of any sewer or        water main constructed by the authority against the        properties benefited, improved or accommodated thereby to the        extent of such benefits. These benefits shall be assessed in        the manner provided under this chapter for the exercise of        the right of eminent domain.            (22)  To charge the cost of construction of a sewer or        water main constructed by the authority against the        properties benefited, improved or accommodated by the        construction according to the foot front rule. Charges shall        be based upon the foot frontage of the properties benefited        and shall be a lien against such properties. Charges may be        assessed and collected and liens may be enforced in the        manner provided by law for the assessment and collection of        charges and the enforcement of liens of the municipality in        which such authority is located. No charge shall be assessed        unless prior to the construction of a sewer or water main the        authority submitted the plan of construction and estimated        cost to the municipality in which the project is to be        undertaken and the municipality approved it. The properties        benefited, improved or accommodated by the construction may        not be charged an aggregate amount in excess of the approved        estimated cost.            (23)  To require the posting of financial security to        insure the completion in accordance with the approved plat        and with the rules and regulations of the authority of any        water mains or sanitary sewer lines, or both, and related        apparatus and facilities required to be installed by or on        behalf of a developer under an approved land development or        subdivision plat as these terms are defined under the act of        July 31, 1968 (P.L.805, No.247), known as the Pennsylvania        Municipalities Planning Code. If financial security is        required by the authority and without limitation as to other        types of financial security which the authority may approve,        which approval shall not be unreasonably withheld, federally        chartered or Commonwealth-chartered lending institution        irrevocable letters of credit and restrictive or escrow        accounts in these lending institutions shall be deemed        acceptable financial security. Financial security shall be        posted with a bonding company or federally chartered or        Commonwealth-chartered lending institution chosen by the        party posting the financial security if the bonding company        or lending institution is authorized to conduct business        within this Commonwealth. The bond or other security shall        provide for and secure to the authority the completion of        required improvements within one year from the date of        posting of the security. The amount of financial security        shall be equal to 110% of the cost of the required        improvements for which financial security is to be posted.        The cost of required improvements shall be established by        submitting to the authority a bona fide bid from a contractor        chosen by the party posting the financial security. In the        absence of a bona fide bid, the cost shall be established by        an estimate prepared by the authority's engineer. If the        party posting the financial security requires more than one        year from the date of posting the financial security to        complete the required improvements, the amount of financial        security may be increased by an additional 10% for each one-        year period beyond the first anniversary date from the        initial posting date or to 110% of the cost of completing the        required improvements as reestablished on or about the        expiration of the preceding one-year period by using the        above bidding procedure. As the work of installing the        required improvements proceeds, the party posting the        financial security may request the authority to release or        authorize the release of, from time to time, portions of the        financial security necessary to pay the contractor performing        the work. Release requests shall be in writing addressed to        the authority, and the authority shall have 45 days after        receiving a request to ascertain from the authority engineer,        certified in writing, that the portion of the work has been        completed in accordance with the approved plat. Upon        receiving written certification, the authority shall        authorize release by the bonding company or lending        institution of an amount estimated by the authority engineer        to fairly represent the value of the improvements completed.        If the authority fails to act within the 45-day period, it        shall be deemed to have approved the requested release of        funds. The authority may, prior to final release at the time        of completion and certification by its engineer, require        retention of 10% of the estimated cost of improvements. If        the authority accepts dedication of all or some of the        required improvements following completion, it may require        the posting of financial security to secure structural        integrity of the improvements as well as the functioning of        the improvements in accordance with the design and        specifications as depicted on the final plat and the        authority's rules and regulations. This financial security        shall expire not later than 18 months from the date of        acceptance of dedication and shall be of the same type as set        forth in this paragraph with regard to that which is required        for installation of the improvements, except that it shall        not exceed 15% of the actual cost of installation of the        improvements. Any inconsistent ordinance, resolution or        statute is null and void.            (24)  To charge enumerated fees to property owners who        desire to or are required to connect to the authority's sewer        or water system. Fees shall be based upon the duly adopted        fee schedule which is in effect at the time of payment and        shall be payable at the time of application for connection or        at a time to which the property owner and the authority        agree. In the case of projects to serve existing development,        fees shall be payable at a time to be determined by the        authority. An authority may require that no capacity be        guaranteed for a property owner until the tapping fees have        been paid or secured by other financial security. The fees        shall be in addition to any charges assessed against the        property in the construction of a sewer or water main by the        authority under paragraphs (21) and (22) as well as any other        user charges imposed by the authority under paragraph (9),        except that no reservation of capacity fee or other similar        charge shall be imposed or collected from a property owner        who has applied for service unless the charge is based on        debt and fixed operating expenses. A reservation of capacity        fee or other similar charge may not exceed 60% of the average        sanitary sewer bill for a residential customer in the same        sewer service area for the same billing period. Any authority        opting to collect a reservation of capacity fee or other        similar charge may not collect the tapping fee until the time        as the building permit fee is due. Tapping fees shall not        include costs included in the calculation of any other fees,        assessments, rates or other charges imposed under this act.                (i)  The fees may include any of the following if            they are separately set forth in a resolution adopted by            the authority:                    (A)  Connection fee. A connection fee shall not                exceed an amount based upon the actual cost of the                connection of the property extending from the                authority's main to the property line or curb stop of                the property connected. The authority may also base                the connection fee upon an average cost for                previously installed connections of similar type and                size. Such average cost may be trended to current                cost using published cost indexes. In lieu of payment                of the fee, an authority may require the construction                of those facilities by the property owner who                requested the connection.                    (B)  Customer facilities fee. A customer                facilities fee shall not exceed an amount based upon                the actual cost of facilities serving the connected                property from the property line or curb stop to the                proposed dwelling or building to be served. The fee                shall be chargeable only if the authority installs                the customer facilities. In lieu of payment of the                customer facilities fee, an authority may require the                construction of those facilities by the property                owner who requests customer facilities. In the case                of water service, the fee may include the cost of a                water meter and installation if the authority                provides or installs the water meter. If the property                connected or to be connected with the sewer system of                the authority is not equipped with a water meter, the                authority may install a meter at its own cost and                expense. If the property is supplied with water from                the facilities of a public water supply agency, the                authority shall not install a meter without the                consent and approval of the public water supply                agency.                    (C)  Tapping fee. A tapping fee shall not exceed                an amount based upon some or all of the following                parts which shall be separately set forth in the                resolution adopted by the authority to establish                these fees. In lieu of payment of this fee, an                authority may require the construction and dedication                of only such capacity, distribution-collection or                special purpose facilities necessary to supply                service to the property owner or owners.                        (I)  Capacity part. The capacity part shall                    not exceed an amount that is based upon the cost                    of capacity-related facilities, including, but                    not limited to, source of supply, treatment,                    pumping, transmission, trunk, interceptor and                    outfall mains, storage, sludge treatment or                    disposal, interconnection or other general system                    facilities. Except as specifically provided in                    this paragraph, such facilities may include only                    those that provide existing service. The cost of                    capacity-related facilities, excluding facilities                    contributed to the authority by any person,                    government or agency, or portions of facilities                    paid for with contributions or grants other than                    tapping fees, shall be based upon their                    historical cost trended to current cost using                    published cost indexes or upon the historical                    cost plus interest and other financing fees paid                    on debt financing such facilities. To the extent                    that historical cost is not ascertainable,                    tapping fees may be based upon an engineer's                    reasonable written estimate of current                    replacement cost. Such written estimate shall be                    based upon and include an itemized listing of                    those components of the actual facilities for                    which historical cost is not ascertainable.                    Outstanding debt related to the facilities shall                    be subtracted from the cost except when                    calculating the initial tapping fee imposed for                    connection to facilities exclusively serving new                    customers. The outstanding debt shall be                    subtracted for all subsequent revisions of the                    initial tapping fee where the historical cost has                    been updated to reflect current cost except as                    specifically provided in this section. For                    tapping fees or components related to facilities                    initially serving exclusively new customers, an                    authority may, no more frequently than annually                    and without updating the historical cost of or                    subtracting the outstanding debt related to such                    facilities, increase such tapping fee by an                    amount calculated by multiplying the tapping fee                    by the weighted average interest rate on the debt                    related to such facilities applicable for the                    period since the fee was initially established or                    the last increase of the tapping fee for such                    facilities. The capacity part of the tapping fee                    per unit of design capacity of said facilities                    required by the new customer shall not exceed the                    total cost of the facilities as described herein                    divided by the system design capacity of all such                    facilities. Where the cost of facilities to be                    constructed or acquired in the future are                    included in the calculation of the capacity part                    as permitted herein, the total cost of the                    facilities shall be divided by the system design                    capacity plus the additional capacity to be                    provided by the facilities to be constructed or                    acquired in the future. An authority may allocate                    its capacity-related facilities to different                    sections or districts of its system and may                    impose additional capacity-related tapping fees                    on specific groups of existing customers such as                    commercial and industrial customers in                    conjunction with additional capacity requirements                    of those customers. The cost of facilities to be                    constructed or acquired in the future that will                    increase the system design capacity may be                    included in the calculation of the capacity part,                    subject to the provisions of clause (VI). The                    cost of such facilities shall not exceed their                    reasonable estimated cost set forth in a duly                    adopted annual budget or a five-year capital                    improvement plan. The authority shall have taken                    at least two of the following actions toward                    construction of the facilities:                            (a)  obtained financing for the                        facilities;                            (b)  entered into a contract obligating                        the authority to construct or pay for the                        cost of construction of the facilities or its                        portion thereof in the event that multiple                        parties are constructing the facilities;                            (c)  obtained a permit for the                        facilities;                            (d)  obtained title to or condemned                        additional real estate upon which the                        facilities will be constructed;                            (e)  entered into a contract obligating                        the authority to purchase or acquire                        facilities owned by another;                            (f)  prepared an engineering feasibility                        study specifically related to the facilities,                        which study recommends the construction of                        the facilities within a five-year period;                            (g)  entered into a contract for the                        design or construction of the facilities or                        adopted a budget which includes the use of                        in-house resources for the design or                        construction of the facilities.                        (II)  Distribution or collection part. The                    distribution or collection part may not exceed an                    amount based upon the cost of distribution or                    collection facilities required to provide                    service, such as mains, hydrants and pumping                    stations. Facilities may only include those that                    provide existing service. The cost of                    distribution or collections facilities, excluding                    facilities contributed to the authority by any                    person, government or agency, or portions of                    facilities paid for with contributions or grants                    other than tapping fees, shall be based upon                    historical cost trended to current cost using                    published cost indexes or upon the historical                    cost plus interest and other financing fees paid                    on debt financing such facilities. To the extent                    that historical cost is not ascertainable,                    tapping fees may be based upon an engineer's                    reasonable written estimate of replacement cost.                    Such written estimate shall be based upon and                    include an itemized listing of those components                    of the actual facilities for which historical                    cost is not ascertainable. Outstanding debt                    related to the facilities shall be subtracted                    from the cost except when calculating the initial                    tapping fee imposed for connection to facilities                    exclusively serving new customers. The                    outstanding debt shall be subtracted for all                    subsequent revisions of the initial tapping fee                    where the historical cost has been updated to                    reflect current cost except as specifically                    provided in this section. For tapping fees or                    components related to facilities initially                    serving exclusively new customers, an authority                    may, no more frequently than annually and without                    updating the historical cost of or subtracting                    the outstanding debt related to such facilities,                    increase such tapping fee by an amount calculated                    by multiplying the tapping fee by the weighted                    average interest rate on the debt related to such                    facilities applicable for the period since the                    fee was initially established or the last                    increase of the tapping fee for such facilities.                    The distribution or collection part of the                    tapping fee per unit of design capacity of said                    facilities required by the new customer shall not                    exceed the cost of the facilities divided by the                    design capacity. An authority may allocate its                    distribution-related or collection-related                    facilities to different sections or districts of                    its system and may impose additional                    distribution-related or collection-related                    tapping fees on specific groups of existing                    customers such as commercial and industrial                    customers in conjunction with additional capacity                    requirements of those customers.                        (III)  Special purpose part. A part for                    special purpose facilities shall be applicable                    only to a particular group of customers or for                    serving a particular purpose or a specific area                    based upon the cost of the facilities, including,                    but not limited to, booster pump stations, fire                    service facilities, water or sewer mains, pumping                    stations and industrial wastewater treatment                    facilities. Such facilities may include only                    those that provide existing service. The cost of                    special purpose facilities, excluding facilities                    contributed to the authority by any person,                    government or agency, or portions of facilities                    paid for with contributions or grants other than                    tapping fees, shall be based upon historical cost                    trended to current cost using published cost                    indexes or upon the historical cost plus interest                    and other financing fees paid on debt financing                    such facilities. To the extent that historical                    cost is not ascertainable, tapping fees may be                    based upon an engineer's reasonable written                    estimate of current replacement cost. Such                    written estimate shall be based upon and include                    an itemized listing of those components of the                    actual facilities for which historical cost is                    not ascertainable. Outstanding debt related to                    the facilities shall be subtracted from the cost                    except when calculating the initial tapping fee                    imposed for connection to facilities exclusively                    serving new customers. The outstanding debt shall                    be subtracted for all subsequent revisions of the                    initial tapping fee where the historical cost has                    been updated to reflect current cost except as                    specifically provided in this section. For                    tapping fees or components related to facilities                    initially serving exclusively new customers, an                    authority may, no more frequently than annually                    and without updating the historical cost of or                    subtracting the outstanding debt related to such                    facilities, increase such tapping fee by an                    amount calculated by multiplying the tapping fee                    by the weighted average interest rate on the debt                    related to such facilities applicable for the                    period since the fee was initially established or                    the last increase of the tapping fee for such                    facilities. The special purpose part of the                    tapping fee per unit of design capacity of such                    special purpose facilities required by the new                    customer shall not exceed the cost of the                    facilities as described herein divided by the                    design capacity of the facilities. Where an                    authority constructs special purpose facilities                    at its own expense, the design capacity for the                    facilities may be expressed in terms of the                    number of equivalent dwelling units to be served                    by the facilities. In no event shall an authority                    continue to collect any tapping fee which                    includes a special purpose part after special                    purpose part fees have been imposed on the total                    number of design capacity units used in the                    original calculation of the special purpose part.                    An authority may allocate its special purpose                    facilities to different sections or districts of                    its system and may impose additional special                    purpose tapping fees on specific groups of                    existing customers such as commercial and                    industrial customers in conjunction with                    additional capacity requirements of those                    customers.                        (IV)  Reimbursement part. The reimbursement                    part shall only be applicable to the users of                    certain specific facilities when a fee required                    to be collected from such users will be                    reimbursed to the person at whose expense the                    facilities were constructed as set forth in a                    written agreement between the authority and such                    person at whose expense such facilities were                    constructed.                        (V)  Calculation of tapping fee.                            (a)  In arriving at the cost to be                        included in the tapping fee, the same cost                        shall not be included in more than one part                        of the tapping fee.                            (b)  No tapping fee may be based upon or                        include the cost of expanding, replacing,                        updating or upgrading facilities serving only                        existing customers in order to meet stricter                        efficiency, environmental, regulatory or                        safety standards or to provide better service                        to or meet the needs of existing customers.                            (c)  The cost used in calculating tapping                        fees shall not include maintenance and                        operation expenses.                            (d)  As used in this subclause,                        "maintenance and operation expenses" are                        those expenditures made during the useful                        life of a sewer or water system for labor,                        materials, utilities, equipment accessories,                        appurtenances and other items which are                        necessary to manage and maintain the system                        capacity and performance and to provide the                        service for which the system was constructed.                        Costs or expenses to reduce or eliminate                        groundwater infiltration or inflow may not be                        included in the cost of facilities used to                        calculate tapping fees unless these costs or                        expenses result in an increase in system                        design capacity.                            (e)  Except as otherwise provided for the                        calculation of a special purpose part, the                        design capacity required by a new residential                        customer used in calculating sewer or water                        tapping fees shall not exceed an amount                        established by multiplying 65 gallons per                        capita per day for water capacity, 90 gallons                        per capita per day for sewer capacity times                        the average number of persons per household                        as established by the most recent census data                        provided by the United States Census Bureau.                        If an authority service area is entirely                        within a municipal boundary for which there                        is corresponding census data specifying the                        average number of persons per household,                        issued by the United States Census Bureau,                        the average shall be used. If an authority                        service area is not entirely within a                        municipal boundary but is entirely within a                        county or other geographic area within                        Pennsylvania for which the United States                        Census Bureau has provided the average number                        of persons per household, then that average                        for the county or geographic area shall be                        used. If an authority service area is not                        entirely within a municipal, county or other                        geographic area within Pennsylvania for which                        the United States Census Bureau has                        calculated an average number of persons per                        household, then the Pennsylvania average                        number of persons per household shall be used                        as published by the United States Census                        Bureau. Alternatively, the design capacity                        required for a new residential customer shall                        be determined by a study but shall not                        exceed:                                (i)  for water capacity, the average                            residential water consumption per                            residential customer, or, for sewage                            capacity, the average residential water                            consumption per residential customer plus                            ten percent. The average residential                            water consumption shall be determined by                            dividing the total water consumption for                            all metered residential customers in the                            authority's service area over at least a                            12-consecutive-month period within the                            most recent five years by the average                            number of customers during the period; or                                (ii)  for sewer capacity, the average                            sewage flow per residential customer                            determined by a measured sewage flow                            study. Such study shall be completed in                            accordance with sound engineering                            practices within the most recent five                            years for the lesser of three or all                            residential subdivisions of more than ten                            lots which have collection systems in                            good repair and which connected to the                            authority's facilities within the most                            recent five years. The study shall                            calculate the average sewage flow per                            residential customer in such developments                            by measuring actual sewage flows over at                            least 12 consecutive months at the points                            where such developments connected to the                            authority's sewer main.                                (iii)  All data and other information                            considered or obtained by an authority in                            connection with determining capacity                            under this subsection shall be made                            available to the public upon request.                                (iv)  If any person required to pay a                            tapping fee submits to the authority an                            opinion from a professional engineer that                            challenges the validity of the results of                            the calculation of design capacity                            required to serve new residential                            customers prepared under subparagraph (i)                            or (ii), the authority shall within 30                            days obtain a written certification from                            another professional engineer, who is not                            an employee of the authority, verifying                            that the results and the calculations,                            methodology and measurement were                            performed in accordance with this title                            and generally accepted engineering                            practices. If an authority does not                            obtain a certification required under                            this subsection within 30 days of                            receiving such challenge, the authority                            may not impose or collect tapping fees                            based on any such challenged calculations                            or study until such engineering                            certification is obtained.                            (f)  An authority may use lower design                        capacity requirements and impose lower                        tapping fees for multifamily residential                        dwellings than imposed on other types of                        residential customers.                        (VI)  Separate accounting for future facility                    costs. Any portion of tapping fees collected                    which, based on facilities to be constructed or                    acquired in the future in accordance with this                    section, shall be separately accounted for and                    shall be expended only for that particular                    facility or a substitute facility accomplishing                    the same purpose which is commenced within the                    same period. Such accounting shall include, but                    not be limited to, the total fees collected as a                    result of including facilities to be constructed                    in the future, the source of the fees collected                    and the amount of fees expended on specific                    facilities. The proportionate share of tapping                    fees based upon facilities to be constructed or                    acquired in the future under this section shall                    be refunded to the payor of such fees within 90                    days of the occurrence of the following:                            (a)  the authority abandons its plan or a                        part thereof to construct or acquire a                        facility or facilities which are the basis                        for such fee; or                            (b)  the facilities have not been placed                        into service within seven years, or, for an                        authority which provides service to five or                        more municipalities, the facilities have not                        been placed into service within 15 years,                        after adoption of a resolution which imposes                        tapping fees which are based upon facilities                        to be constructed or acquired in the future.                        Any refund of fees held for 15 years shall                        include interest for the period the money was                        held.                        (VII)  Definitions. As used in this clause,                    the following words and phrases shall have the                    meanings given to them in this subclause:                        "BOD5."  The five-day biochemical-oxygen                    demand.                        "Design capacity."  For residential                    customers, the permitted or rated capacity of                    facilities expressed in million gallons per day.                    For nonresidential customers, design capacity may                    also be expressed in pounds of BOD5 per day,                    pounds of suspended solids per day or any other                    capacity-defining parameter that is separately                    and specifically set forth in the permit                    governing the operation of the system and based                    upon its original design as modified by those                    regulatory agencies having jurisdiction over                    these facilities. Additionally, for separate fire                    service customers, the permitted or rated                    capacity of fire service facilities may be                    expressed in peak flows. The units of measurement                    used to express design capacity shall be the same                    units of measurement used to express the system                    design capacity. Except as otherwise provided for                    special purpose facilities, design capacity may                    not be expressed in terms of equivalent dwelling                    units.                        "Outstanding debt."  The principal amount                    outstanding of any bonds, notes, loans or other                    form of indebtedness used to finance or refinance                    facilities included in the tapping fee.                        "Service line."  A water or sewer line that                    directly connects a single building or structure                    to a distribution or collection facility.                        "System design capacity."  The design                    capacity of the system for which the tapping fee                    is being calculated which represents the total                    design capacity of the treatment facility or                    water sources.                (ii)  Every authority charging a tapping, customer            facilities or connection fee shall do so only pursuant to            a resolution adopted at a public meeting of the            authority. The authority shall have available for public            inspection a detailed itemization of all calculations,            clearly showing the maximum fees allowable for each part            of the tapping fee and the manner in which the fees were            determined, which shall be made a part of any resolution            imposing such fees. A tapping, customer facilities or            connection fee may be revised and imposed upon those who            subsequently connect to the system, subject to the            provisions and limitations of the act.                (iii)  No authority shall have the power to impose a            connection fee, customer facilities fee, tapping fee or            similar fee except as provided specifically under this            section.                (iv)  A municipality or municipal authority with            available excess sewage capacity, wishing to sell a            portion of that capacity to another municipality or            municipal authority, may not charge a higher cost for the            capacity portion of the tapping fee as the selling entity            charges to its customers for the capacity portion of the            tapping fee. In turn, the municipality or municipal            authority buying this excess capacity may not charge a            higher cost for the capacity portion of the tapping fee            to its residential customers than that charged to them by            the selling entity.                (v)  As used in this paragraph, the term "residential            customer" shall also include those developing property            for residential dwellings that require multiple tapping            fee permits. This paragraph shall not be applicable to            intermunicipal or interauthority agreements relative to            the purchase of excess capacity by an authority or            municipality in effect prior to February 20, 2001.            (25)  To construct tunnels, bridges, viaducts,        underpasses or other st