Pay-to-play laws present a minefield for compliance because they can be found not only at the state level, but also the local level. As one of the most recent examples, beginning on April 1, 2022, Delaware County Pennsylvania, just outside of Philadelphia, will require disclosure of certain political contributions by county contractors and subcontractors anticipating receiving $50,000 or more under a covered contract required to be approved by the county council. Contributions made by the contractor’s and subcontractor’s corporate affiliates, officers, directors, partners, and their spouses are also subject to disclosure. Violations may result in the loss of contracts and a contract ban.

What contributions must be disclosed

Contributions of any amount made in the 24 months prior to the date the county council will consider the contract:

• From the covered contractor (which includes a subcontractor) and
  • A corporate parent, subsidiary, or other affiliate of the covered contractor;
  • An officer or director of the covered contractor;
  • A shareholder or partner of the covered contractor with a 5% or greater ownership interest;
  • The spouse of any person listed above; and
  • Any contribution reimbursed by a person listed above.
• To:
  • Candidates for county office, state legislative districts that represent Delaware County, or statewide executive branch offices;
  • Pennsylvania state, county, or municipal political party committees;
  • A PAC, if the contribution is given with the intent or expectation that some or all of the contribution will be directed to a candidate listed above; and
  • A PAC controlled by a person or entity listed above (covered contractor and its affiliated entities and individuals).

Pre-Award Disclosures

Invitations to bid, requests for proposal, or other contract solicitations by the county for covered contracts will include a requirement that bidders/respondents provide the required contribution disclosure form. For all other covered contracts, each contractor must provide the county clerk with the disclosure form at least 8 days before the meeting at which the county council will consider the approval of the covered contract. If the disclosure form shows any reportable contributions, the county clerk will publicly post the form on the county’s website no later than the public posting of the agenda for the meeting at which the contract will be considered.

Annual Reports

Beginning in January 2023, each covered contractor under a covered contract with a term exceeding one year must provide the county clerk with an updated annual disclosure form by January 30.

Penalties for Non-Disclosure

A covered contractor that fails to provide disclosure forms or that submits disclosure forms that are materially inaccurate may be banned as a contractor or subcontractor to the county for up to three years. Additionally, the covered contract may be terminated.