As previously reported in the PSATS Morning News, a divided Pennsylvania Supreme Court recently ruled that a stormwater management charge imposed by the Borough of West Chester was a tax that could not be collected from West Chester University, a Commonwealth entity immune from municipal taxation. 

The Supreme Court determined that the borough, a home rule municipality, was acting in a public capacity because it was “providing stormwater management services out of duty, for the public benefit, and in the absence of a contractual relationship” and that, as a result, its charge was a tax. 

The Second Class Township Code is the only Pennsylvania municipal code that has language expressly authorizing stormwater management fees (the Municipalities Authorities Act also has similar language applicable to municipal authorities). Section 2705 of the Second Class Township Code states, that “a township may assess reasonable and uniform fees based in whole or in part on the characteristics of the property benefited from the facilities, systems, and management plans.” Considering this statutory authorization, PSATS recommends that townships continue with their stormwater management fee programs unless a court rules that assessment of fees under Section 2705 of the Second Class Township Code is impermissible (the Supreme Court’s decision did not address Section 2705 of the Second Class Township Code). 

As with any instance in which the Supreme Court issues a ruling impacting municipal governments, PSATS also recommends that its members consult with their solicitors or other legal advisors and determine whether any changes should or could be made to improve their stormwater management fee ordinances in light of the decision.