Pennsylvania Statutes Title 53 P.S. Municipal and Quasi-Municipal Corporations § 5572. Department shall investigate financial condition of such political subdivision;  hearing to creditors

When any such petition shall be submitted to the Department of Internal Affairs for approval, accompanied with a proposed plan of readjustment of the debts of a political subdivision, the department shall make a careful and thorough investigation of the financial condition of such political subdivision, of its assets and liabilities, of its sinking fund, and whether the affairs thereof are managed in a careful, prudent, and economic manner in order to ascertain whether the presentation of such petition is justified, or represents an unjust attempt by such political subdivision to evade payment of some of its contractual obligations, and, if the department believes that such petition should be approved, whether the plan of readjustment submitted, will be helpful to the financial condition of the political subdivision, and is feasible, and at the same time fair and equitable to all creditors.

The Department of Internal Affairs shall also, prior to giving its approval, ascertain the amount, if any, of the obligations of any such petitioning political subdivision which is held by any agency or agencies of the State government as trust funds, and shall, before approving any such petition and plan of readjustment, consult with and give every such agency an opportunity to be heard and the privilege to examine the findings of the department resulting from the investigation hereinbefore required to be made, and shall likewise hear any other creditor of such political subdivision, whether resident within or without this Commonwealth, who shall apply therefor.

The department, if it approves a petition, shall, before giving its approval, require such modification in the proposed plans for readjusting the debts as to it appears proper.