72 Pa. Stat. § 3655
If, in the opinion of the commissioners of the sinking fund, the purchase of loans of the commonwealth cannot be made for the best interests of the commonwealth, it shall be the duty of the said commissioners, to authorize the purchase, by the fiscal agent of the state, of the bonds of the United States at the then market rates; the fiscal agent of the state shall make immediate return to the said commissioners of the number and amount of each bond of the United States so purchased, and the premium paid therefor. And it shall be the duty of the state treasurer to enter on the "sinking fund ledger" the number, amount, and premium paid for each United States bond so returned, as purchased by the fiscal agent of the state: Provided, That the sinking fund commissioners shall have the right to dispose of bonds purchased under this act, whenever the money shall be required for the extinguishment of the public debt: Provided further, That the sinking fund commissioners shall have authority to sell the bonds of the United States, so purchased, whenever the loans of the commonwealth can be bought at such prices as they may deem for the best interests of the commonwealth, and state loans thus purchased shall be immediately cancelled as provided by section one of this act.
72 P.S. § 3655