Wm. Penn Parking Garage, Inc. v. City of Pittsburgh

• Decision Date: 16 January 1974
• Citation: 314 A.2d 322,11 Pa.Cmwlth. 507
• Parties: WM. PENN PARKING GARAGE, INC., et al., Appellants, v. CITY OF PITTSBURGH, Appellee.
• Court: Pennsylvania Commonwealth Court

314 A.2d 322

11 Pa.Cmwlth. 507

WM. PENN PARKING GARAGE, INC., et al., Appellants, v. CITY OF PITTSBURGH, Appellee.

Commonwealth Court of Pennsylvania.

January 16, 1974

Argued Nov. 7, 1973.

Leonard Boreman, Richard H. Martin, Baskin Boreman, Wilner, Sachs, Gondelman & Craig, Pittsburgh, for appellants.

Grace S. Harris, Sp. Asst. City Sol., Ralph Lynch, Jr., City Sol Pittsburgh, for appellee.

Before BOWMAN, President Judge, and CRUMLISH Jr., KRAMER, WILKINSON, MENCER, ROGERS and BLATT, JJ.

OPINION

ROGERS Judge.

We are again confronted with issues arising out of the City of Pittsburgh's effort to obtain public revenue from persons who must find places to park motor vehicles or from persons who, for a price, would provide such accommodations or on account of the transaction whereby the one obtains and the other supplies that tiny sanctuary from the hated parking ticket and the dreaded municipal tow truck.

After our decision in Alco Parking Corporation v. Pittsburgh, 6 Pa.Cmwlth. 433, 291 A.2d 556, 295 A.2d 349 (1972), upholding but questioning the reasonableness of Ordinance No. 704 which imposed a tax of 20 per cent on the gross receipts of all commercial parking transactions, and before we were reversed and the ordinance struck down by our Supreme Court in Alco Parking Corporation v. Pittsburgh, 453 Pa. 245, 307 A.2d 851 (1973), City Council adopted Ordinance No. 30 of 1973 which imposes 'upon each parking transaction by a patron of a nonresidential parking place at the rate of 20 per centum (20%) on the consideration for each such transaction . . .' The City by taxing the patron sought to cure in advance the infirmity of confiscation of the operators property found by the Supreme Court to be suffered by Ordinance No. 704. The instant case is an attack on Ordinance No. 30 by some of the commercial operators who were plaintiffs in the Alco case, supra, joined by 55 individuals. The form of action is by appeal pursuant to Section 6 of The Local Tax Enabling Act, Act of Dec. 31, 1965, P.L. 1257, 53 P.S. § 6906, which provides in pertinent part:

'No tax levied for the first time by any political subdivision to which this act applies shall go into effect until thirty days from the time of the adoption of the ordinance or resolution levying the tax. Within said thirty days, taxpayers representing twenty-five percent or more of the total valuation of real estate in the political subdivision as assessed for taxation purposes, or taxpayers of the political subdivision not less than twenty-five in number aggrieved by the ordinance or resolution shall have the right to appeal therefrom to the court of quarter sessions of the county upon giving bound with sufficient security in the amount of five hundred dollars ($500), approved by the court, to prosecute the appeal with effect and for the payment of costs. The petition shall set forth the objections to the tax and the facts in support of such objections, and shall be accompanied by the affidavit of at least five of the petitioners that the averments of the petition are true and the petition is not filed for the purpose of delay.

'It shall be the duty of the court to declare the ordinance and the tax imposed thereby to be valid unless it concludes that the ordinance is unlawful or finds that the tax imposed is excessive or unreasonable; but the court shall not interfere with the reasonable discretion of the legislative body in selecting the subjects or fixing the rates of the tax. The court may declare invalid all or any portion of the ordinance or of the tax imposed or may reduce the rates of tax.'

The petitioners' objections are that the tax imposed by Ordinance No. 30 is confiscatory because it prevents the operator-petitioners from making a profit, that it discriminates against the operator-petitioners in favor of the Public Parking Authority of Pittsburgh ^[1] and that it is excessive, unreasonable and unconscionable. Except by the denunciatory adjectives last mentioned, the appeal petition fails to disclose the nature of the objections of the individual petitioners or their particular interest in the appeal.

The city filed preliminary objections which included a demurrer on the ground that 'the complaint relies for a relief on an unconstitutional delegation of taxing power to the judiciary.' The court below sustained the demurrer and dismissed the appellants' petition without evidentiary hearing or leave to amend. We are required to reverse.

The court's action, we gather from its opinion, was based upon two grounds:

(1) That none of the petitioners appear by their pleading to be taxpayers aggrieved by the ordinance and therefore lack standing; the operators, because the new tax is not imposed on them and because their complaint that the tax will cause them to lose patronage is speculative and remote; the individual petitioners because, even if they complain as patrons of parking facilities required to pay the tax, their interest is no different from that of any other member of the general public and 'no one has a right not to be taxed.'

(2) That the Legislature has by Section 6 of The Local Tax Enabling Act unconstitutionally delegated legislative power to the judiciary.

We have concluded that the lower court's action in dismissing the petition was error.

The Local Tax Enabling Act was enacted in 1947. Act of June 25, 1947, P.L. 1145. ^[2] It expressed the Legislature's recognition that real estate levies, almost the only source of revenue theretofore permitted municipal subdivisions, provided an inequitable if not insufficient base for the money which would be necessary to supply the schools, roads, and other public improvements traditionally supplied locally, neglected during four years of war. The Act was also evidence of the realization that values in a more complex and otherwise changed society had to a large extent shifted from real estate to other subjects, including commercial transactions of many kinds. While this vast delegation of the taxing power was generally approved as necessary, it was recognized as a new departure in municipal government, as evidenced by its popular name, the 'Tax Anything Act'. The Legislature, however, chose not to confer this broad power to find and to tax subjects and objects previously beyond the reach of local tax gatherers without also according the taxed a right to judicial review of the wide discretion thus given local officials. Section 6 provides this safeguard.

The court below held that neither parking lot operators who may suffer loss of business nor individual persons who will have to pay the tax are aggrieved taxpayers given the right to appeal by Section 6. We disagree. We must, in determining who the Legislature meant should have the right to complain in this kind of case, 'look at the Act as well as the facts.' Committee to Preserve Mill Creek v. Secretary of Health, 3 Pa.Cmwlth. 200, 206, 281 A.2d 468, 472 (1971). While, as we have noted, The Local Tax Enabling Act gives municipalities wide discretion to tax, it also prescribes notice and other procedural requirements to the passage of the authorized taxing measures and it imposes limitations on certain specific levies and the general requirement that they must be the product of the exercise of a reasonable discretion and not excessive. Surely the Legislature intended to afford ready access to judicial determination of the regularity of these enactments. If operators of lots are taxpayers of the municipality and if they can prove, as they allege, that the tax, although imposed on their patrons, will cause them loss of income, it seems to us that they have standing to complain by the plain wording of the Section. If the individual petitioners, subjected to the tax, are not taxpayers aggrieved, we cannot conceive of who may be. Finally, the thing appealed from under Section 6 is a taxing ordinance, not a decision rendered in an adversary proceeding. Case law concerning parties aggrieved entitled to appeal administrative orders is of doubtful precedential value here. See, however, Denny Building Corporation Appeal, 387 Pa. 311, 127 A.2d 724 (1956) in which the Supreme Court held that the owners and occupants of dwelling houses were persons aggrieved and directly affected by the action of administrative officers exempting a builder from compliance with statutory requirements. Assuming, nevertheless, that the Legislature intended that persons invoking Section 6 should have a direct and pecuniary interest in the outcome, the appellants here meet that standard.

The lower court, as noted, held Section 6 unconstitutional as a delegation to the judiciary of legislative power, that is, the power to tax. It discerned this most clearly apparently in the phrase empowering the court 'to reduce the rates of tax' upon a finding that a tax is excessive or unreasonable.

The first duty of a Pennsylvania court faced with deciding whether the Act of the General Assembly transgresses constitutional limitations, is to apply fundamental standards to its own deliberations. Some of these are:

1) 'An Act of Assembly will not be declared unconstitutional unless it Clearly, palpably and Plainly violates the Constitution.' Daly v. Hemphill, 411 Pa. 263, 271, 191 A.2d 835, 840 (1963). (Emphasis original).

2) '. . . (E)very presumption is in favor of the constitutionality of acts of the legislative body. . . .' Glancey v. Casey, 447 Pa. 77, 88, 288 A.2d 812, 818 (1972).

3) 'It is a long recognized doctrine that whenever an act of assembly is susceptible of different constructions it is the duty of a court of justice to give to the act that construction which harmonizes with the constitution, for such is presumed to be the legislative intent.' Dolan v. Linton's Lunch...