Clearwater Construction, Inc. and Northampton County Bridge Partners, LLC, Appellants
Northampton County General Purpose Authority, Northampton County Department of Community and Economic Development, and Kriger Construction, Inc.
Argued: June 8, 2017
BEFORE: HONORABLE RENÉE COHN JUBELIRER, Judge,
HONORABLE JULIA K. HEARTHWAY, Judge, HONORABLE DAN
PELLEGRINI, Senior Judge.
RENÉE COHN JUBELIRER, Judge.
Construction, Inc. and Northampton County Bridge Partners,
LLC (Clearwater, collectively) appeal from an October 3, 2016
Order of the Court of Common Pleas of Northampton County
(common pleas), which found Clearwater lacked standing to
challenge a contract awarded under the Public-Private
Transportation Partnership Act (P3 Act), 74 Pa. C.S.
§§ 9101-9124. Common pleas found that relief under
Section 9109(n) of the P3 Act, 74 Pa. C.S. § 9109(n),
was limited to a "development entity, " and
Clearwater was not a "development entity" as
defined by the P3 Act because it was not a party to a
public-private partnership agreement. Finding no error in
common pleas' interpretation of the P3 Act, we affirm.
April 2016, the Northampton County General Purpose Authority
(Authority), on behalf of the Northampton County Department
of Community and Economic Development (County), issued a
Request for Proposals (RFP) for the Northampton County Bridge
Renewal Program (Bridge Program), which called for
replacement, rehabilitation, and/or maintenance of 33 bridges
located in Northampton County. The RFP was issued under the
P3 Act. Clearwater and Kriger Construction, Inc. (Kriger)
were among four offerors who responded to the RFP and
submitted proposals. Ultimately, Kriger was selected to
negotiate a public-private partnership agreement with the
Authority to develop the Bridge Program.
September 19, 2016, Clearwater commenced this action by
filing a Petition and Claim Pursuant to 74 Pa. C.S. §
9109(n) Protesting the Award of Government Contract
(Petition), alleging multiple issues with the RFP process, as
well as challenging Kriger's qualifications. On September
27, 2016, Clearwater also filed a Motion for a Preliminary
Injunction. On September 28, 2016, the Authority filed
Preliminary Objections to Clearwater's Petition,
asserting Clearwater lacked standing to file the Petition
because Clearwater is only an offeror.
hearing on the preliminary injunction request was scheduled
for September 29, 2016, but common pleas initially heard
argument on the preliminary objections because they raised a
jurisdictional issue. Following oral argument and briefing,
common pleas issued an Order on October 3, 2016, finding
Clearwater lacked standing, denying Clearwater's motion
for injunctive relief, and dismissing the action. This appeal
a party that bids on a municipal project governed by the P3
Act but is ultimately not chosen for the project has standing
to challenge the propriety of the selection process is a
matter of first impression. The P3 Act is a lesser known and
used procurement process, which our Court has only once
before had occasion to address, albeit in the context of the
Right-to-Know Law (RTKL). See Dep't of Transp. v.
Walsh/Granite JV, 149 A.3d 425 (Pa. Cmwlth. 2016).
There, we compared the P3 Act with the better known
Procurement Code (Code), 62 Pa. C.S. §§ 101-2311:
Under the Procurement Code, contracts are output-based, where
the public sector owner identifies the exact outputs required
through detailed specifications. Each phase of the project is
procured separately and multiple contracts pertaining to that
phase may be awarded. Contracts are awarded in stages:
companies bid on the design; once the design is completed, a
contract is awarded for construction; once construction is
completed, it becomes the public entity's maintenance
responsibility. Because the Procurement Code process is
output-based, most of the risks associated with normal
procurement contracts are assumed by the public sector
entity. Usually, each project is financed directly by
government through capital contributions or debt. . . .
The P3 [Act] presents an alternative method to [that] set
forth in the Procurement Code to build or maintain public
infrastructure. Under the P3 [Act], procurement of two or
more of the project delivery phases can be integrated and
those methods may involve anything from designing and
constructing to operating, maintaining and financing the
project. Moreover, P3 contracts have outcome-based
specifications, meaning that the public sector owner
specifies its requirements and the private sector partner
determines the best way to meet them. Typically, in a P3
contract, the public sector partner would be responsible for
securing its own financing, with the private sector partner
financing the upfront capital costs and then recovering its
investment over the term of the P3 agreement. Also, the
private sector party assumes substantial financial, technical
and operational risk, and a Public-Private Transportation
Partnership Board was created to oversee the process and
select P3 projects.
Id. at 430 (citations omitted).
Section 9106 of the P3 Act, a public entity may solicit
transportation projects through an RFP. 74 Pa. C.S. §
9106. Offerors submit a response, which is then evaluated by
the public entity to determine if it is in the best interest
of the public entity. Id. Here, the Authority, on
behalf of the County, utilized this process to solicit bids
for the Bridge Program. Clearwater submitted a bid but was
not chosen. Unhappy with the selection made, Clearwater
brought a claim under Section 9109(n) of the P3 Act. The
trial court dismissed the claim, finding Clearwater lacked
core concept of standing is that 'a party who is not
negatively affected by the matter he seeks to challenge is
not aggrieved, and thus, has no right to obtain judicial
resolution of his challenge.'" In re Milton
Hershey School, 911 A.2d 1258, 1261 (Pa. 2006) (quoting
City of Phila. v. Commonwealth, 838 A.2d 566, 577
(Pa. 2003)). Absent a statutory provision, a disappointed
bidder lacks standing because he has no property interest in
a public contract and, therefore, has suffered no injury that
would entitle him to redress in court. Black Ash Servs.,
Inc. v. DuBois Area Sch. Dist., 764 A.2d 672, 674 (Pa.
Cmwlth. 2000); James T. O'Hara, Inc. v. Borough of
Moosic, 611 A.2d 1332, 1333 (Pa. Cmwlth. 1992); J.P.
Mascaro & Sons, Inc. v. Bristol Twp., 505 A.2d 1071,
1073 (Pa. Cmwlth. 1986). A bidder that is an aggrieved
taxpayer of the municipality awarding the contract has
standing, however. Black Ash, 764 A.2d at 674.
maintains Section 9109(n) of the P3 Act provides a statutory
basis for a disappointed bidder, such as itself, to challenge