Section 457.4. Statements to be furnished under oath

(a) Generally. The following procedures shall be followed in making a statement:

(1) The Contractor’s Financial Statement, Form 4300, Part 1: Organization and Experience Statement Form 4300, Part 2, and Affirmative Action Statement Form 4300, Part 3 shall be the documents used in determining qualifications of an applicant and capacity to bid upon contract work undertaken by the Department. From the information provided, the Department will establish whether the applicant is entitled to be prequalified and receive a rating which will determine his maximum capacity and classifications of work on which he shall be eligible to bid.

(2) Questions shall be answered fully and the information requested be properly presented. The Department will return incomplete forms for completion or correction. This action will delay review of submittal by an applicant and the assignment of ratings.

(3) One set of each form shall be sent to each applicant which shall be returned to the Department.

(4) A complete set of application forms may be acquired from the Prequalification Office, Bureau of Construction and Materials, Contract Management Division, Department of Transportation, 7th floor, Forum Place, 555 Walnut Street, Harrisburg, Pennsylvania 17101-1900. They shall be mailed or delivered to the Prequalification Office at this above address.

(5) At the option of the applicant, the submission of Contractor’s Financial Statement, Form 4300, Part 1, may be omitted and in lieu thereof, the applicant will be assigned a maximum capacity as specified in § 457.5(f)(2) (relating to classification). An applicant exercising this option shall be considered eligible to perform work only as a subcontractor.

(b) Contractor’s Financial Statement, Form 4300, Part 1. This part will be reviewed by the Office of Comptroller. The following procedures shall be followed in completing Form 4300, Part 1:

(1) Each applicant, whether a corporation, copartnership or individual, shall complete the applicable parts of Form 4300, Part 1, Contractor’s Financial Statement, and shall submit the statement as part of the application for prequalification. The form provides for balance sheet data with supporting schedules and follows closely the standard and accepted form generally used in presenting an adequate financial report, and shall show all assets and liabilities, including verification of lines of credit extended by banks. This form or statement shall include certification, rendered with an opinion, by a certified public accountant, public accountant or foreign accountant registered in accordance with The C.P.A. Law (63 P. S. § § 9.1—9.16b) as to the financial condition of the prospective contractor. Financial statements prepared in states other than the Commonwealth will not be accepted unless they include certification by a certified public accountant.

(2) No financial statement may be accepted which has been prepared by a certified public accountant, public accountant or foreign accountant who is directly connected with or has a financial interest in the business of the contractor submitting the statement.

(3) An applicant shall provide an audited financial statement when the applicant’s net working capital is in excess of $50,000. A review type of financial statement is acceptable only when the applicant’s net working capital does not exceed $50,000. If the net working capital is negative, or if the maximum capacity rating as calculated in § 457.5(f) exceeds $4 million, a review type of statement is not acceptable and an audited financial statement will be required. Financial statements shall be current. A financial statement which is received by the Prequalification Officer later than 9 months after the balance sheet date may not be accepted. Financial statements received more than 6 months after the balance sheet date shall include an assurance by the accountant that there are no material changes in the financial condition of the applicant since the balance sheet date. For significant changes in a contractor’s financial status which occur subsequent to the balance sheet date and which adversely affect the contractor’s financial condition, the Department has the right to reevaluate the contractor’s financial statement and to adjust the assets, liabilities, line-of-credit and book value of equipment, and consequently, the assigned maximum capacity rating, or to reject the statement outright.

(4) Financial statements shall be reviewed by the prequalification accountant in accordance with current accounting concepts as published by the American Institute of Certified Public Accountants. Accordingly, adjustments in the treatment of assets or liabilities may be made by the Department as deemed necessary. On major adjustments, the applicant shall receive advance written notice thereof.

(5) Line-of-credit statements, if submitted from banks for the purpose of establishing financial qualifications in determining rating, shall be furnished on Department forms included in Form 4300, Part 1. A line-of-credit statement is not required for prequalification. The line-of-credit shall be designated in the name of the firm applying for prequalification.

(6) Applicants shall make certain their line-of-credit statements contain no restrictive qualifications and are valid for the entire prequalification period. In cases where these statements expire before the prequalification expiration date the capacity rating shall be correspondingly reduced when line-of-credit statements expire, unless renewed or extended.

(7) No line of credit statements will be considered when applicant elects to exercise the option specified in subsection (a)(5).

(c) Contractor’s Organization and Experience Statement, Form 4300, Part 2. This part will be reviewed by the Contractor Evaluation Engineer. The following procedures shall be followed in completing Form 4300, Part 2:

(1) The information and data to be submitted on Form 4300, Part 2, Contractor’s Organization and Experience Statement is largely self-explanatory. Each applicant (contractor) shall be assigned a rating which will designate the classifications of work upon which he shall be eligible to bid. Thus the Department will establish the maximum amount of work which a qualified contractor may have under contract and incomplete at any one time and beyond which no further work will be awarded him. This total amount of work, or maximum capacity rating, shall be a flat sum determined in accordance with the formula in § 457.5.

(2) The attention of the contractor is particularly invited to the section of the form in which inquiries are made relative to the work classifications desired. The applicant shall indicate his desires on classifications of work for which a rating is sought. As a general rule classifications may not be assigned in excess of those requested.

(3) Each contractor and subcontractor shall furnish, under oath, the following statements:

(i) A statement as to plant and equipment, which shall give complete details as to type, age and condition. If equipment is leased, the applicant shall list the owner by the name of the organization or individual from whom the equipment is leased at the time of balance sheet date.

(ii) A statement as to organization which shall develop the adequacy of such organization, including key personnel, to undertake a project in the classification desired.

(iii) A statement as to prior and current experience of the contractor, his principal officers and key employes which shall show the number of years the contractor has been engaged in the contracting business and shall further disclose generally his experience over that period.

(iv) A statement which shall give an accurate and complete record of work done in the past 5 years, as a contractor of record, or an approved subcontractor, giving the names of projects undertaken, the types of work, the locations, the contract price and the name of the principal engineer in charge for the contracting agency.

(v) A statement which shall list in detail liens, stop notices or claims filed against the contractor on any project within the past 5 years. This statement shall also disclose failures to complete a contract or contracts, and penalties imposed by reason of a contract undertaken and adjudicated noncompliance with pertinent statutes within the 5-year period. The prospective bidder shall explain the items.

(vi) A statement indicating how many years the organization has been in business as a contractor under its present business name.

(vii) A statement indicating the number of years of experience in highway construction work the organization has.

(viii) A statement indicating whether the organization ever failed to complete any work awarded to it.

(ix) A statement indicating whether any officer or partner of the organization has ever been an officer or partner of some other organization that failed to complete a construction contract.

(x) A statement indicating if any officer or partner of the organization has ever failed to complete a construction contract performed in his own name.

(xi) A statement indicating whether the organization has ever been denied prequalification in this Commonwealth or another state under its name or another name.

(xii) A statement indicating whether the organization has ever been disqualified or removed from a bidding list in this Commonwealth or another state under its name or another name.

(xiii) A listing indicating the construction experience of the officers and management personnel, including superintendents of the organization.

(xiv) A listing of affiliated or subsidiary organizations and companies.

(xv) A listing of organizations, individuals, or both, who have a financial interest of 10% or more in the company.

(xvi) A listing of the persons having a financial interest in the organization, and who also have a financial interest in another organization prequalified or eligible to bid in this Commonwealth or another state.

(xvii) A listing of other organizations or individuals who control or influence the bidding of the company.

(xviii) A statement indicating misdemeanor convictions involving moral turpitude, conviction of a bidding crime and other felony convictions of the contractor, as well as the contractor’s directors, partners, principal officers and key employes.

(xix) A statement setting forth other relevant, pertinent and material facts that may justify the rating desired.

(4) Equipment owned or otherwise available to the contractor shall be an important consideration in determining ratings, particularly for some categories of work. In some cases, ownership or control of specific items of equipment may be a prerequisite. It is important, therefore, that the descriptive information requested shall be given, especially for major equipment items. Equipment which is still serviceable, even though fully depreciated, shall be included.

(5) As a general condition, applicants shall possess and have available, appropriate and sufficient equipment to perform the contemplated work, or have current assets sufficient to purchase or lease the necessary equipment.

(6) Arrangements, such as valid rental agreements, and status as owner, majority stockholder or officer in an equipment company, may be considered. The arrangements shall be reported and explained.

(7) The equipment listed as being owned by the contractor in the Contractor’s Organization and Experience Statement, Form 4300, Part 2, shall be identical with a similar list of equipment in the Contractor’s Financial Statement, Form 4300, Part 1. If these lists differ, an explanation of the difference shall be included in the application.

(8) It will facilitate the processing of the rating of the contractor if the equipment is listed by type; that is, shovels together, pavers together and so forth, by age and condition.

(d) Contractor’s Affirmative Action Statement, Form 4300, Part 3. This part will be reviewed by the Bureau of Equal Opportunity. The information requested in Form 4300, Part 3, shall be submitted in full to comply with 16 Pa. Code Chapter 49 (relating to contract compliance), the Federal Civil Rights Act of 1964, Presidential Executive Order No. 11246 as amended, and 41 CFR 60-60.4 (relating to confidentiality and relevency of information).

(e) Complete statement of misdemeanor convictions involving moral turpitude and felony convictions of the contractor, as well as the contractor’s directors, principal officers and key employes.

The provisions of this § 457.4 adopted September 21, 1973, effective September 22, 1973, 3 Pa.B. 2133; amended August 8, 1975, effective August 9, 1975, 5 Pa.B. 2035; amended April 13, 1979, effective April 14, 1979, 9 Pa.B. 1308; amended November 28, 1980, effective November 29, 1980, 10 Pa.B. 4470; amended April 11, 1997, effective July 1, 1997, 27 Pa.B. 1798. Immediately preceding text appears at serial pages (122932) to (122936).

Notation

Notes of Decisions

In determining compliance with 67 Pa. Code § 457.4(e), which requires a complete statement of a contractor’s convictions, the word ‘‘conviction’’ is to be accorded the popular meaning rather than the technical meaning, and thus a conviction exists upon a finding of guilty by the court even though sentencing has not yet been imposed. E. Smalis Painting Co. v. Department of Transportation, 452 A.2d 601 (Pa. Cmwlth. 1982).

Cross References

This section cited in 67 Pa. Code § 457.3 (relating to general requirements); 67 Pa. Code § 457.5 (relating to classification); and 67 Pa. Code § 457.17 (relating to notification).