255 A.3d 321
Pa.2021Background
- Pennsylvania’s CFA/ DCED created the Alternative and Clean Energy (ACE) program to provide grants and loans for alternative energy projects under the Alternative Energy Investment Act.
- U.S. Venture applied for two ACE awards to add CNG pumps to existing, privately owned fueling stations; the parties executed documents titled “Alternative and Clean Energy Grant Agreement.”
- Venture completed the projects and sought payment; the CFA denied reimbursement because Venture leased equipment (so claimed no construction costs) and allegedly failed to follow competitive-bidding requirements.
- Venture filed a claim with the Board of Claims; the Commonwealth raised preliminary objections, arguing grants are excluded from the Procurement Code (62 Pa.C.S. §102(f)) and sovereign immunity bars the claim.
- The Board found the statutory term “public” ambiguous but resolved ambiguity in favor of the Commonwealth, concluding the Commonwealth had no ownership/control of the stations and the agreements were grants excluded from the Code; the Commonwealth Court (en banc) affirmed.
- The Pennsylvania Supreme Court affirmed, applying rules favoring preservation of sovereign immunity and holding the agreements were grants (not procurement contracts) because they furnished assistance to support a program and did not procure construction for the Commonwealth.
Issues
| Issue | Plaintiff's Argument | Defendant's Argument | Held |
|---|---|---|---|
| Whether the Board of Claims has subject-matter jurisdiction over Venture’s contract claims given §102(f)’s exclusion of grants and sovereign immunity | Venture: ambiguous language should be construed to preserve Board jurisdiction; grants whose primary purpose procure construction for the grantor bring claims within the Code | Commonwealth: grants are excluded by §102(f); sovereign immunity preserved; Code should be read to require governmental ownership/control for "construction" | Held: No jurisdiction — ambiguities resolved in favor of sovereign immunity; §102(f) excludes grants and the agreements here were grants |
| Meaning of "public" in definition of "construction" (whether it permits "publicly accessible" or requires governmental ownership/control) | Venture: "public" has ordinary dictionary meanings including publicly-accessible; ambiguity requires construing jurisdictional provisions to preserve court access | Commonwealth: "public" in procurement/related statutes requires ownership/control by government; read in pari materia with Separations Act and Borough Act | Held: "Public" requires some element of government ownership/control in this context; mere public accessibility is insufficient |
| Whether the written grant agreements were actually procurement contracts because their primary purpose was to procure construction for the grantor | Venture: the ACE program procures development/construction of clean-energy projects; §102(f) exception (awards whose primary purpose is to procure construction for grantor) applies | Commonwealth: §102(f) defines a grant as assistance supporting a program; the agreements gave funds to a private entity to further ACE (a subsidy), not to procure Commonwealth-owned construction | Held: Agreements were grants — funds furnished to support a program and did not procure construction for the Commonwealth |
| Which interpretive presumption governs: strict construction of provisions decreasing court jurisdiction vs. strict construction of waivers of sovereign immunity | Venture: statutory-construction rules require strict construction of provisions that decrease court jurisdiction, favoring plaintiff | Commonwealth: waivers of sovereign immunity must be narrowly construed; statutory reaffirmation of immunity (62 Pa.C.S. §1702) controls | Held: Presumption favoring narrow construction of waivers of sovereign immunity controls; interpretive doubts resolved to preserve immunity |
Key Cases Cited
- Scientific Games Int'l, Inc. v. Commonwealth, 66 A.3d 740 (Pa. 2013) (treats sovereign immunity as a jurisdictional concern under the Procurement Code and emphasizes narrow waivers)
- Tragesser v. Cooper, 169 A. 376 (Pa. 1933) (interprets "public building" to mean buildings owned or to be owned by the municipality)
- Mechanical Contractors Ass'n of Northwestern Pa. v. Senior Citizen Health Care Council of Erie County, 674 A.2d 752 (Pa. Commw. 1996) (holds "public building" means government-owned/controlled structure under Separations Act)
- Employers Ins. of Wausau v. Dep't of Transp., 865 A.2d 825 (Pa. 2005) (discusses Board of Claims jurisdiction and prior enabling statutes)
- Hanover Ins. Co. v. State Workers' Ins. Fund, 35 A.3d 849 (Pa. Commw. 2012) (analyzed Board jurisdiction under Procurement Code amendments)
- Data-Quest, Inc. v. Dep't of Health, 972 A.2d 74 (Pa. Commw. 2009) (applies strict construction to provisions decreasing court jurisdiction and addresses Board jurisdictional questions)
- Shovel Transfer & Storage, Inc. v. Simpson, 565 A.2d 1153 (Pa. 1989) (historical discussion of Board of Claims authority over contractual claims)