Board of Claims jurisdiction: To qualify as a grant to “procure construction” as to which the grantee may sue the Commonwealth, must the construction be for a publicly owned or controlled structure?

U.S. Venture, Inc. v. Commonwealth, et al., 227 A.3d 462 (Pa. Cmwlth. 2020), allocatur granted August 25, 2020, appeal docket 51 MAP 2020.

The Pennsylvania Supreme Court granted allocatur to examine whether the Board of Claims has subject matter jurisdiction over a breach of contract claim to enforce an award of a Commonwealth grant where the construction for which the grant is provided is not for a publicly owned or controlled structure.

U.S. Venture, Inc. (“U.S. Venture”) received grants to aid in the construction of two publicly accessible compressed natural gas vehicle fueling stations. Upon completion of construction, the Commonwealth denied reimbursement for the amount of the grants.

U.S. Ventures filed a breach of contract claim with the Board of Claims. The Commonwealth filed preliminary objections, arguing that the Board lacked jurisdiction because, although claims involving grants fall within the Board’s jurisdiction where the grants involve construction of a publicly owned or controlled structure, U.S. Venture’s fueling stations, while accessible to the public, were not publicly owned. The Board agreed it lacked jurisdiction and the Commonwealth Court affirmed.  The court interpreted the Procurement Code definition of “construction” to conclude that its reference to “public structures or buildings” means a structure owned by the government, rather than a structure that is publicly accessible, reasoning:

Because the CNG fueling stations are not “owned or to be owned and used by a government entity (or its alter ego) for a government-authorized public purpose[,]” [citation omitted], this Court holds that they are not public structures under the Procurement Code. Because the CNG fueling stations are not public structures and, therefore, do not fall within the Procurement Code’s definition of construction, the Grants do not constitute “an award whose primary purpose is to procure construction for the grantor” under Section 102(f) of the Procurement Code, and sovereign immunity bars Petitioner’s action. 62 Pa.C.S. § 102(f).

Slip Op. at 16-17.

The Supreme Court granted allocatur to determine:

Whether the Commonwealth Court erred in utilizing a narrow statutory construction of the ambiguous definition of “construction,” which refers to “public structures or buildings,” set forth in the Procurement Code, to find that the Board has no subject matter jurisdiction over [Petitioner]’s breach of contract claims, thus leaving [Petitioner] without any legal remedy?

For more information, contact Kevin McKeon or Dennis Whitaker.