The Pennsylvania Supreme Court has agreed to hear a case regarding the constitutionality of property tax appeals filed by local school districts. This could be a landmark decision impacting commercial property owners throughout the state.
Pennsylvania school districts have a statutory right to file appeals to raise property owners' assessments. Typically, the appeals are filed against large commercial owners because the tax payoff is greater. The Supreme Court will determine whether a school district is permitted to selectively appeal properties strictly for revenue-generating purposes.
The court will hear Valley Forge Towers Apts., LP v. Upper Merion Area School District and Keystone Advisors LC. In the case, taxpayers who own apartment buildings charged that the school district contracted with a consulting firm to identify and recommend property assessments to be appealed. The taxpayers contend that, through its relationship with the consulting firm, the school district targeted certain classes of commercial properties and not residential property. The taxpayers argue that such targeting constitutes spot assessment, which violates the Pennsylvania Constitution's Uniformity Clause.
If the Supreme Court agrees with the earlier ruling of the Commonwealth Court in favor of the school district, it will essentially validate the district's rationale for selecting which taxpayers to target for appeals.
This will likely lead to even more school-initiated appeals against commercial property owners.