School District Appeals of Only Commercial Properties are Unconstitutional

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Tax Policy

Uniformity clauses in the federal and state constitutions require taxes on the same class of property be uniform. In this article, Cozen O'Connor's Joseph C. Bright discusses a Pennsylvania Supreme Court case that found selective appeals of only commercial property violated the state uniformity clause.

Joseph C. Bright

By Joseph C. Bright

Joseph C. Bright is a member with Cozen O'Connor.

In a unanimous decision, the Pennsylvania Supreme Court held that the grant of preliminary objections to an action by property owners against a school district that appealed only the real estate tax assessments of commercial properties was in error. The case was remanded to the lower courts for further proceedings. Valley Forge Towers Apartments N LP v. Upper Merion School District, No. 49 MAP 2016 (Pa. July 5, 2017).


Pennsylvania's Constitution states that all taxes shall be uniform, upon the same class subjects, within the territorial limits of the authority levying the tax, and shall be levied and collected under general laws. Pa. Constit. Art. VIII, §1. The property owner plaintiffs brought an action directly in court claiming that the school district followed a practice of appealing only the assessments of commercial properties. The school district filed preliminary objections, claiming that the district has a statutory right to take appeals. 53 Pa. C.S. §8855. The trial court granted the preliminary objections; the Commonwealth Court affirmed; and the Supreme Court reversed.

The court first disposed of the school district's arguments that the taxpayers failed to exhaust administrative remedies, as the school district appeals were pending below. Because of the alleged pervasive nature of the school district practice, it was appropriate to entertain the challenge in equity. The court further dismissed the arguments that assessment appeals pending below rendered the issue moot.

All Real Estate One Class

On the constitutional issue, the court held that a prior decision did not sanction assessing properties by subclasses of property within the taxing jurisdiction. While a taxpayer may prove a lack of uniformity by referring to the assessments of comparables, that does not undermine the basic principle that all real estate is one class and must be assessed accordingly. Downingtown Area School District v. Chester County Board of Assessment Appeals, 913 A.2d 194 (Pa. 2006). The court held that, regardless of the statutory right of appeal, a taxing authority such as the school district violates the Uniformity Clause when it selectively takes tax appeals only on commercial properties. The demands of uniformity take precedence over statutory requirements, citing among other authorities Brooks Building, 137 A.2d 273 (Pa. 1958). The court noted further that the statutory power could not lawfully be used to avoid political accountability. The court stated, however, that the opinion did not preclude a school district from setting financial thresholds for taking appeals.

Since the case was remanded, there was no discussion whether the allegations of the complaint were in fact true and what the consequences would be if they were true. Nor did the court address the question of what relief a taxing authority is entitled to if it takes a proper appeal. Specifically, can relief be granted to a taxing authority in an amount greater than what would constitute a uniform application of the tax laws of the particular property. See e.g., Weissenberger v. Chester County Board of Assessment Appeals, 62 A.3d 501 (Pa. Commw. 2013).

The decision is likely to have a substantial effect on tax appeals taken by school districts. The public perception is that school districts do in fact target only commercial properties, partly for financial reasons and partly to avoid pushback from voters. Consequently, in any tax appeal, a school district may be obliged to justify the criteria on which it selected the particular property for appeal and to demonstrate that the criteria are not unconstitutional.

In the long run, the solutions to the problem of school district instigated spot assessments may be a statutory requirement for periodic county-wide reassessments and a rule that, even with a proper appeal, a school district is not entitled to a reassessment at a value in excess of what will meet uniformity standards.

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