IN THE COMMONWEALTH COURT OF PENNSYLVANIA

1400 North Third Street :

Enterprises, Inc. :

:

v. :

:

The City of Harrisburg :

License and Tax Appeal Board, : No. 1363 C.D. 2016

Appellant : Argued: June 5, 2017

BEFORE: HONORABLE ROBERT SIMPSON, Judge

HONORABLE ANNE E. COVEY, Judge (P.)

HONORABLE BONNIE BRIGANCE LEADBETTER, Senior Judge

OPINION BY 

JUDGE COVEY FILED: November 29, 2017

The City of Harrisburg’s (City) License and Tax Appeal Board (Appeal 

Board) appeals from the Dauphin County Common Pleas Court’s (trial court) July 11, 

2016 order vacating the Appeal Board’s decision upholding the City’s nonrenewal of 

1400 North Third Street Enterprises, Inc.’s (Licensee) Business and Mercantile 

License (License) for the year 2016.

1 There are three issues before this Court: (1) 

whether the Liquor Code2 preempts the City’s authority to revoke the License based 

on criminal activity at or near Licensee’s premises; (2) whether the trial court erred 

by concluding that the Appeal Board’s decision was not supported by substantial 

evidence; and, (3) whether the trial court failed to properly apply the Local Agency 

Law,

3

and usurped the Appeal Board’s authority as fact-finder. After review, we 

affirm. 

 

1 The License is established under Chapter 5-715 of the City’s Codified Ordinances, titled 

Business Privilege and Mercantile Tax.

2 Act of April 12, 1951, P.L. 90, as amended, 47 P.S. §§ 1-101 – 10-1001.

3

2 Pa.C.S. §§ 551-555, 751-754.
2

Licensee holds the License, a city health license and a liquor license 

issued by the Pennsylvania Liquor Control Board (PLCB) for Third Street Café

(Third Street Café, Premises), located at 1400 North 3rd Street in the City. On 

December 1, 2014, upon receipt of Licensee’s annual renewal application, the City 

issued Licensee a 2015 License. Pursuant to Section 5-715.8 of the City’s Codified 

Ordinances (the Ordinance)4and Section 109 of the City’s Business and Mercantile 

Tax Regulations (Regulation 109),

5

the “License/Permit” contains the following 

 

4 The Ordinance (contained in the City’s Codified Ordinances, Chapter 5-715, titled 

“Business Privilege and Mercantile Tax”) provides:

A. Any person desiring to conduct, or to continue to conduct, any 

business within the City shall file with the Business Administrator or 

designee an application for a business privilege and mercantile license 

and shall pay a fee of $40 for the license and $40 for each renewal 

thereof. . . . 

B. The issuance of a business privilege and mercantile license is 

predicated upon the applicant first receiving the approval of the 

Zoning Administrator and/or Health Officer, where applicable, for the 

operation of his or her business.

C. Regardless of whether or not a license is procured, the tax required 

to be paid pursuant to this chapter is due if a person operates a 

business within the City. Regardless of whether or not a business is 

exempt from paying the tax, a person or entity who operates a 

business within the City shall obtain a mercantile license.

D. Any mercantile/business privilege license issued by the City is 

subject to revocation by the issuing authority upon a 

determination that the licensee has violated one or more 

provisions of the Codified Ordinances of the City.

E. Any person whose license is subject to revocation shall have the 

right to request an administrative hearing before the Business 

Administrator within 10 days of the notice of violation and prior to 

revocation. The decision of the Business Administrator may be 

appealed in accordance with the Local Agency Law.

City’s Codified Ordinance, § 5-715.8 (emphasis added).

5 Regulation 109 states in pertinent part:

The Business Privilege and Mercantile License may be suspended or 

revoked at any time by the Mayor or designee if it is determined that 
3

notification: “All licenses and permits may be suspended or revoked at any time by 

the Mayor or his designee if it is determined that the holder of the license secured the 

same by misrepresentation . . . consent to or allowed any behavior which would 

constitute a crime under federal, state or local laws, including, but not limited to drug 

trafficking or drug possession . . . or allowed any manner or form of public nuisance.” 

Reproduced Record (R.R.) at 192a. 

On March 27, 2015, the City’s Tax and Enforcement Administrator sent 

Licensee a Notice of Revocation of Business License (Notice). The Notice stated, in 

relevant part:

The grounds for the revocation of your license stem from 

multiple incidents as logged by the [City’s] police 

department in which this establishment allowed behavior 

which constituted a crime(s) under federal, state or local 

laws, including, but not limited to, drug trafficking or drug 

possession; committed an act(s) of gross negligence, or 

allowed any manner or form of public nuisance. 

Section[s] 101 and 109 of the [City’s Business and 

Mercantile Tax Regulations] recite several events and/or 

conditions which trigger suspension or revocation of a 

license. Under the provisions, we may revoke a license 

upon an assessment that the holder . . . consented to or 

allowed any behavior which would constitute a crime under

federal, state or local laws, including but not limited to drug 

possession; committed an act of gross negligence, or 

allowed any manner or form of public nuisance.

 

the holder of the permit or license . . . consented to or allowed any 

behavior which would constitute a crime under federal, state, or local 

laws, including, but not limited to drug trafficking or drug possession 

. . . or allowed any manner or form of public nuisance.

To allow for proper due process, the [Appeal Board] is hereby 

authorized to handle any pre-depravation [sic] and/or appeals from the 

license and permit holders. A record shall be made of all hearings in 

order to preserve such for any appeals to the Courts.

Regulation 109.
4

Under the [Optional] Third Class City . . . [C]harter [L]aw[6]

[(Charter Law)] (upon which the governance of the [City] is

based), it is specifically within the power of the Mayor (or 

those to whom the Mayor delegates the responsibility) to 

suspend or revoke any and all permits and licenses issued 

by the City.

R.R. at 197a. 

On April 3, 2015, Licensee appealed from the revocation. The Appeal 

Board held a hearing on May 20, 2015. In advance of the hearing, the City provided 

Licensee with ten police reports pertaining to incidents requiring police involvement

at or near the Premises. During the hearing, Licensee’s counsel objected to various 

statements and to the police reports as hearsay. Licensee’s counsel argued, based on 

case law, that “hearsay evidence admitted without objection can be given its natural 

probative effect and may support a finding of fact if it’s corroborated by any 

competent evidence in the record; but a finding of fact based solely on hearsay will 

not stand.” Notes of Testimony, May 20, 2015 (N.T.) at 26. In response, City’s 

counsel distinguished the cited cases and argued: 

Under the Pennsylvania [C]ode[,] the definition of agency -

- regarding the standard rules for hearings – the definition 

of agency expressly excludes political subdivisions.

So the rules do not apply to political subdivisions. And you 

cannot glean that the Court determined because there are 

rules from a State agency under its mandate for its statute 

that the same apply to the local government proceedings, 

which tend to be informal in nature.

Id. Later, in response to Licensee’s counsel’s hearsay objection to police testimony 

from other officers’ police reports, City’s counsel argued: 

We are not involved in the constitutional rights of a citizen. 

We are involved in a business license, which is a separate 

and distinct thing. We are involved in an application for a 

 

6 Act of July 15, 1957, P.L. 901, as amended, 53 P.S. §§ 41101–41625. 
5

government privilege which has on the application the right 

to be revoked for certain things. . . . If we were in a 

criminal trial, the rules would be very different; but we are 

not in a criminal trial. 

And rightfully so, because if local governments had to meet 

that standard simply to manage their day-to-day affairs, 

local governments couldn’t operate. The legislature did not 

intend when it gave us the power to have hearing boards, 

have revocations, have licensing to have those requirements 

for each and every thing we do. 

Id. at 44-45. 

Licensee’s counsel also objected to the City Police Chief’s testimony 

regarding several additional alleged incidents occurring at or near the Premises based 

on the City’s failure to provide notice and/or documentation thereof. In response, 

City’s counsel stated: “You have no right to notice of those occurrences, you have no 

right to discovery.” N.T. at 28.7 The Appeal Board noted Licensee’s objection and 

 

7We acknowledge, this Court has explicitly stated: “While . . . local agencies are not bound 

by technical rules of evidence, findings based solely on hearsay cannot stand.” Goodman v. 

Commonwealth, 511 A.2d 274, 277 (Pa. Cmwlth. 1986) (emphasis added). Although the City 

argues in its reply brief that Licensee waived its hearsay objections because it “did not raise the 

issue of hearsay in [its] general statement of objections to the [Appeal] Board’s Decision in the 

[t]rial [c]ourt nor did [it] raise the issue in [its] brief below[,]” the trial court’s opinion and 

Licensee’s trial court brief demonstrate otherwise. City Reply Br. at 9. The trial court specifically 

noted that “[Licensee] raises a number of additional issues in support of [its] appeal. [Licensee] 

argues constitutional and hearsay issues, and a conflict of interest by one of the [Appeal B]oard 

members.” Trial Court Op. at 12 (emphasis added). Further, Licensee specifically raised the 

hearsay issue relative to the December 15, 2015 police report to the trial court. See R.R. at 304a. 

Licensee did not object on hearsay grounds to the other police reports since those reports were 

offered at the May 20, 2015 hearing pertaining to the 2015 revocation and Licensee argued that 

those reports should not be admitted. Nonetheless, because Licensee raised the hearsay issue to the 

Appeal Board, the trial court and this Court, it was clearly preserved and, thus, not waived.

We also recognize that although the Local Agency Law does not provide for discovery, the 

representation by City’s counsel that Licensee is not entitled to notice of the occurrences which 

form the basis for nonrenewal is incorrect. This Court has stated:

While incapable of exact definition, the essential elements of 

procedural due process are ‘notice and opportunity to be heard and to 

defend in an orderly proceeding adapted to the nature of the case 

before a tribunal having jurisdiction of the cause.’ Fiore v. Bd. of Fin. 
6

 

& Revenue, . . . 633 A.2d 1111, 1114 ([Pa.] 1993) (quotations 

omitted). Whether due process has been afforded must be examined 

in relation to the particular circumstances of each case. Dunn v. Dep’t 

of Transp., Bureau of Motor Vehicles, 819 A.2d 189, 192 (Pa. 

Cmwlth. 2003.) ‘Notice is the most basic requirement of due process. 

. . . Notice should be reasonably calculated to inform interested 

parties of the pending action. . . . The form of the notice required 

depends on what is reasonable, considering the interests at stake and 

the burdens of providing notice.’ Pa. Coal Mining Ass’n v. Ins. 

Dep’t, . . . 370 A.2d 685, 692-93 ([Pa.] 1977). ‘Failure to provide 

adequate notice is a jurisdictional defect that invalidates 

administrative action until the defect is cured.’ Clark v. Dep’t of Pub. 

Welfare, . . . 427 A.2d 712, 713 ([Pa. Cmwlth.] 1981); see also 2 

Pa.C.S. § 553 (‘No adjudication of a local agency shall be valid as to 

any party unless he shall have been afforded reasonable notice of a 

hearing and an opportunity to be heard.’).

Bornstein v. City of Connellsville, 39 A.3d 513, 519 (Pa. Cmwlth. 2012) (emphasis added). 

“Adequate notice for procedural due process purposes requires at a minimum that the notice 

contain a sufficient listing and explanation of the charges against an individual.” Dunn, 819 

A.2d at 193 (bolded emphasis added). Further, our Supreme Court has explained:

Generally speaking a license granted by a sovereign is ‘a permission 

by a competent authority to do some act which without such 

authorization would be illegal. . .’ Black’s Law Dictionary (Rev’d. 

4th [e]d. 1968). Government licenses generally constitute a form of 

property insofar as they are an entitlement to engage in a valuable 

activity. The grant of certain types of licenses, particularly a license 

to engage in a profession or occupation, may create a right or 

entitlement which triggers procedural rights under the due process 

clause of the Fourteenth Amendment. The government cannot, on 

the one hand, create a business which is dependent on a permit 

and then, with the other, destroy it by revoking the authorizing 

permits without first affording ‘sufficient’ due process. Doran v. 

Houle, 516 F.Supp. 1231 (D. Montana 1981) (citing Standard 

Airlines, Inc. v. Civil Aeronautics B[d.], 177 F.2d 18 [D.C.Cir. 1949]; 

Gonzalez v. Freeman, 334 F.2d 570 [D.C. 1964]). Thus, the 

government must have a fair procedure to determine whether driver’s, 

occupational or business licenses should be revoked. 

Young J. Lee, Inc. v. Dep’t of Revenue, Bureau of State Lotteries, 474 A.2d 266, 270 (Pa. 1983)

(emphasis added). Moreover, Regulation 109 acknowledges the need for due process, wherein it 

states: “To allow for proper due process, the [Appeal Board] is hereby authorized to handle any 

pre-depravation [sic] and/or appeals from the license and permit holders. A record shall be made of 

all hearings in order to preserve such for any appeals to the Courts.” Regulation 109. Given our 
7

permitted the testimony. On August 28, 2015, the Appeal Board upheld the City’s 

revocation of Licensee’s 2015 License (2015 Revocation Decision). Licensee 

appealed from the 2015 Revocation Decision to the trial court. In December 2015, 

the City notified Licensee that it would not renew the License for the 2016 calendar 

year. See R.R. at 29a-30a. In January 2016, the City abandoned its efforts to revoke 

Licensee’s 2015 License,

8 but pursued the nonrenewal of Licensee’s 2016 License

(2016 Nonrenewal).

Licensee filed a motion to stay enforcement action and a motion to 

dismiss the 2016 Nonrenewal, alleging that the Liquor Code preempts the Ordinance 

and Regulation 109. On February 16, 2016, the Appeal Board held a hearing on 

Licensee’s motions. At the hearing, the Appeal Board granted Licensee’s motion to 

stay enforcement, but denied Licensee’s motion to dismiss. Thereafter, Appeal Board 

Chairman Dan A. Schulder informed the parties that there would be a hearing on the 

merits of the motion to stay enforcement as follows:

[W]e are going to take additional evidence with regard to 

the [2016 Nonrenewal] and I’m going to advise the parties 

that the [Appeal] Board intends to make all the evidence 

presented at the May 20th, 2015 hearing part of the record 

on the present appeal.

 

disposition of this matter, we need not resolve the due process issue. However, we note our strong 

disapproval of the City’s position.

8 On January 7, 2016, the trial court dismissed the appeal as moot. The trial court’s order

stated, in relevant part:

[B]y failing to renew [Licensee’s] 2016 [License] while the City’s 

action to revoke [Licensee’s] 2015 [L]icense is still pending[,] the 

City has abandoned the 2015 [License] revocation action and 

rendered such action moot. . . . At a meeting with [Licensee’s] 

Counsel, [] City’s Counsel and this Court on January 4, 2016, [City’s 

Counsel] agreed that the 2015 [License] revocation action was now 

moot. . . . Accordingly, the action . . . shall be dismissed as moot.

Original Record (O.R.), Item No. 1, Appellant’s Emergency Motion for Stay Pending Appeal, Ex. A 

at 2.
8

R.R. at 52a. 

On March 21, 2016, the Appeal Board held its hearing on the 2016 

Nonrenewal. At the hearing, in addition to the evidence presented at the May 20, 

2015 hearing, the City presented evidence of an additional incident involving a 

shooting near the Premises on December 15, 2015.

9

 Subsequent to the hearing, 

Licensee filed a recusal motion and a supplemental recusal motion after it learned 

that an Appeal Board member had failed to disclose her interests in establishments 

holding liquor licenses in the Premises’ vicinity, and that she failed to disclose an 

ongoing relationship and cohabitation with one of the officers who reported on the

December 15, 2015 shooting.

On May 17, 2016, the Appeal Board denied Licensee’s appeal, 

concluding that the Liquor Code did not preempt Regulation 109, Licensee received

due process, the police reports were properly admitted into evidence, Licensee 

consented to or allowed behavior constituting crimes and a public nuisance, and the 

City had properly refused to renew the 2016 License. The Appeal Board further 

ruled that it lacked authority to grant the recusal request, there was an insufficient 

basis for recusal and, even if the challenged member recused, the decision would not 

change. Licensee appealed from the Appeal Board’s decision to the trial court. On 

July 11, 2016, the trial court, based on the record below, sustained Licensee’s appeal

because Section 611 of the Liquor Code preempts the City’s nonrenewal of 

Licensee’s 2016 License. The trial court further held that the Appeal Board’s 

decision was not based on substantial evidence.10 The City appealed to this Court.11

 

9 At the March 21, 2016 hearing, City’s counsel argued that the Appeal Board’s findings of 

fact in its 2015 Revocation Decision relative to the City’s police incidents were conclusive since

Licensee failed to appeal from that dismissal. 

10 Given its disposition of Licensee’s appeal, the trial court found it unnecessary to address 

Licensee’s other alleged errors, including due process violations, improper use of hearsay and bias.

11 The law is well-established:
9

The City first contends that the trial court erred when it held that Section 

611 of the Liquor Code preempted the City’s nonrenewal of Licensee’s 2016 License 

based upon nuisance activity at the Premises. We disagree. Our Courts have 

previously addressed Liquor Code preemption in numerous cases. We review these 

prior holdings for guidance.

In Commonwealth v. Wilsbach Distributors, Inc., 519 A.2d 397 (Pa. 

1986),12 our Supreme Court also addressed issues of Liquor Code preemption 

pertaining to the City’s Business Privilege and Mercantile Tax ordinance. A 

distributor licensed under the Liquor Code was found guilty of a summary offense 

when it refused to pay the City’s Business Privilege and Mercantile Tax on the basis 

that its PLCB-licensed status rendered it exempt. The Court reversed and dismissed 

the citations, explaining:

Our review of the Liquor Code and regulations promulgated 

thereunder indicate the legislature’s clear intent to regulate 

in plenary fashion every aspect of the alcoholic beverage 

industry. Every phase, from manufacture to sale and 

disposition is subject to the exclusive control of the State 

through its designated arm of enforcement, the 

[PLCB].

[13]

 

When the trial court does not take additional evidence, our scope of 

review of a local agency’s adjudication is limited to determining 

whether constitutional rights were violated, an error of law was 

committed, or the necessary factual findings are supported by 

substantial evidence. An agency abuses its discretion when its 

findings of fact are not supported by substantial evidence.

Kuziak v. Borough of Danville, 125 A.3d 470, 474 n.2 (Pa. Cmwlth. 2015) (citation omitted).

12 Wilsbach is a plurality opinion.

13 As of July 1, 1987, the Liquor Code vested enforcement authority in the Pennsylvania 

State Police, Bureau of Liquor Control Enforcement. See Section 211 of the Liquor Code, 47 P.S. § 

2-211, added by § 14 of the Act of June 29, 1987, P.L. 32. However, the PLCB remained

empowered to license establishments to sell liquor and/or malt or brewed beverages. See Section 

207 of the Liquor Code, 47 P.S. § 2-207.
10

As our decisions have made clear, there is perhaps no other 

area of permissible state action within which the exercise of 

the police power of a state is more plenary than in the 

regulation and control of the use and sale of alcoholic 

beverages. The state is vested with the sole authority to 

determine whether alcoholic beverages, their manufacture, 

gift, purchase, sale, possession or transportation shall be 

permitted or prohibited within its borders.

The power of prohibition includes the lesser power of 

regulation and a state may adopt such measures as are 

reasonably appropriate or needful to render the exercise of 

that power effective. In view of the virtually absolute

control over the business of dispensing alcoholic beverages, 

it is clear that the conduct of such business is lawful only 

to the extent that it is made so by the Liquor Code.

In the exercise of its legitimate state interest, the 

Commonwealth, through the [PLCB], directly controls what 

beverages may be bought or sold in the Commonwealth, 

who may sell on the retail and wholesale level, for what 

prices beverages may be sold and bought from the State, 

and to issue licenses to distributors and wholesalers so that 

they may sell to consumers through its [PLCB]. The 

Commonwealth controls not only the geographical location 

of all its licensees, but also the physical structures in which 

beverages may be kept and sold. The site of every licensed 

premise in the Commonwealth is exclusively within the 

discretion of the [PLCB]. The only concessions to 

municipalities is their right to exclude any or all classes of 

licensees (i.e., dry municipalities), . . . and to exercise 

appropriate zoning controls.

Enforcement of the [Liquor] Code and its regulations is 

vested in the [PLCB]. The [PLCB] and its investigative 

staff are vested with the full police power to enter any 

licensed establishment and check for violations of the 

[Liquor] Code, and, if necessary, to arrest violators of the 

[Liquor] Code and its regulations, and to seize unlawfully 

obtained beverages in plain view, without warrant.

As part of the legislature’s regulatory scheme, fees are 

imposed for the privilege of obtaining and keeping licenses 

issued by the [PLCB]. These fees are collected for the 

benefit of the municipalities in which the licensed 
11

establishments are located and are rebated by the 

Commonwealth to those municipalities.

Finally, indicative of the Commonwealth’s plenary exercise 

of control over the alcoholic beverage industry are the 

extensive taxes imposed on all sales of alcohol on the local 

and retail levels. Considerable revenues are generated for 

the Commonwealth by its operation of the State Liquor 

Stores and the additional taxes imposed on purchases and 

sales of alcoholic beverages. In addition to the revenues 

generated by the operation of the State Liquor Stores and 

license fees collected pursuant to the provisions of the 

[Liquor] Code, the Commonwealth also raises revenue by 

its imposition of four other taxes on all sales and purchases 

of alcoholic beverages. 

Wilsbach, 519 A.2d at 400-01 (emphasis added; citations and footnotes omitted). 

The Wilsbach Court concluded:

The regulatory scheme now under review controls a public, 

state-run monopoly, maintained for the health, welfare and 

safety of the citizens of this Commonwealth and upon 

which the Commonwealth depends for substantial revenues.

Such pervasive control over all phases of the liquor 

industry, along with the extensive taxation and fees 

imposed, indicates the legislature’s intent to control this 

industry and to receive all the benefits inherent by 

regulating the industry, including raising revenues through 

regulation to the exclusion of all local attempts to interfere 

with the state regulation by imposing taxes on a local level.

We conclude that the legislature has adopted a scheme of 

regulation so pervasive over the entire alcoholic beverage 

industry, that it has ‘pre-empted the field’ to the exclusion 

of all interference from subordinate legislative bodies. 

Such pre[]emption by the legislature bars local 

legislative control by regulation or taxation.

The Business Privilege and Mercantile Tax imposed on [the 

a]ppellant is a tax on its privilege to conduct a 

distributorship within the City of Harrisburg. This privilege 

is granted by the [s]tate, is absolutely controlled by the 

[s]tate, and not the City of Harrisburg, through fees, 

regulations and taxes, and is, thus, an improper subject for 

the City to tax.
12

Id. at 402 (emphasis added).

In 1994, the General Assembly amended the Liquor Code to provide:

“Nothing in [the Liquor Code] shall be construed to preempt the right of any 

municipality to regulate zoning and enforce any other local ordinances and codes 

dealing with health and welfare issues.” Section 493.1(a) of the Liquor Code, 47 P.S. 

§ 4-493.1(a) (1994 Amendment).

14

In Wissinoming Bottling Co. v. School District of Philadelphia, 654 A.2d 

208 (Pa. Cmwlth. 1995), aff’d by evenly divided court, 672 A.2d 279 (Pa. 1996), this 

Court relied on Wilsbach and held that the City of Philadelphia was preempted from 

collecting use and occupancy (U & O) taxes from PLCB-licensed distributors. The 

Wissinoming Court reasoned:

Our Supreme Court has held that the [c]ity’s U & O tax is a 

tax on the privilege of using real estate for business 

purposes. A malt and brewed beverages distributorship 

cannot be operated at all unless it occupies and uses real 

estate. A distributor must operate in a location and on real 

estate approved by the Commonwealth, and approval of the 

premises used for such distributorship is an integral part of 

the licensing process. The U & O tax, thus, directly impacts 

on [the licensee’s] privilege to operate a distributorship.

Therefore, because the privilege of operating a malt and 

brewed beverages distributorship is granted by the 

Commonwealth and cannot be taxed or regulated by the 

[c]ity, we hold that the [c]ity’s U & O tax is preempted by 

the Liquor Code and by the taxes of alcoholic beverages 

enacted by the Commonwealth, Wilsbach, and that the trial 

court correctly granted [the licensee’s] motion for summary 

judgment.

Wissinoming, 654 A.2d at 212. The Court further expounded: 

Wilsbach . . . preempted local taxes imposed on the 

privilege of operating a beer distributorship; it did not 

 

14 Section 493.1 of the Liquor Code was added by Section 8 of the Act of October 5, 1994, 

P.L. 522. Later amendments moved the relevant language to subpart (a) and added subparts (b), (c) 

and (d).
13

merely proscribe local taxes on a distributorship’s sales. 

Hence, regardless of whether a municipality taxes a 

distributorship’s gross volume of business, as Harrisburg 

did in Wilsbach, or taxes the physical space occupied by a 

distributorship, the municipality is imposing a tax on the 

privilege of operating a distributorship within its territory.

Wissinoming, 654 A.2d at 212.

In 1916 Delaware Tavern, Inc. v. Zoning Board of Adjustment, 657 A.2d 

63 (Pa. Cmwlth. 1995), this Court held that the Liquor Code did not preempt 

Philadelphia’s Zoning Code where adult entertainment establishment liquor licensees 

were denied use variances or granted temporary use variances pursuant to a 

Philadelphia Zoning Code provision regulating the location of such businesses. In 

addressing the matter, the Court refused to retroactively apply Section 493.1 of the 

Liquor Code. It noted, however, that its refusal to apply the 1994 Amendment

“makes little difference in our disposition of this case. Despite the fact that the liquor 

industry remains highly regulated by the Commonwealth, local municipalities even 

before October 5, 1994 had the power to promulgate and enforce appropriate liquorneutral zoning controls.” 1916 Delaware, 657 A.2d at 68. 

In upholding the City of Philadelphia’s application of the relevant 

zoning provision, this Court explained:

[M]erely because the General Assembly intended for the 

Commonwealth by virtue of the Liquor Code to regulate 

morality and lewdness, that does not mean that local

municipalities are precluded from exercising zoning 

controls over establishments thought by some to be 

potentially lewd and/or immoral. As long as the zoning 

regulations are liquor-neutral . . . , liquor licensees should 

not be able to elude zoning regulations and be in any better 

position than ‘dry’ establishments merely by virtue of a 

license to serve alcohol.

1916 Delaware, 657 A.2d at 69 (footnote omitted). The Court also rejected the 

licensees’ argument that preemption was appropriate because the PLCB also 
14

regulates entertainment in a licensed establishment. While acknowledging that “the 

Liquor Code and regulations promulgated thereto seem to cover virtually all 

imaginable aspects of entertainment[,]” the licensees’ characterization of the zoning 

provision as a liquor regulation was erroneous. 1916 Delaware, 657 A.2d at 69. The

Court concluded:

Here, the [c]ity is properly attempting to enforce a zoning 

regulation related to the location, not only of cabarets, 

which might or might not sell alcoholic beverages, but also 

of other establishments such as adult book stores and 

theaters, which do not. Although [c]ity [c]ouncil’s 

definition of cabaret does indeed include descriptions of 

how much cloth entertainers must wear or, as the case may 

be - not wear, in order to qualify an establishment as a 

cabaret, [city c]ouncil in that section also specifically 

outlines permissible and prohibited locations for all

cabarets whether or not licensed by the [PLCB] with a view 

to concerns about matters of public health and welfare, 

aesthetics, economics, crime and neighborhood 

deterioration. Thus, the regulation which does not prohibit 

cabarets, whether with or without licenses, but which 

merely places them in specific geographic locations in the 

[c]ity, has not been preempted by the Liquor Code.

Id. at 70.

In Licensed Beverage Association of Philadelphia v. Board of Education

of School District of Philadelphia, 669 A.2d 447 (Pa. Cmwlth. 1995), abrogated on 

other grounds by Buffalo Township v. Jones, 813 A.2d 659 (Pa. 2002), this Court 

held that the Liquor Code did not preempt Philadelphia City Council’s tax on malt 

and brewed beverages where the General Assembly specifically authorized the 

municipality to impose such a tax. This Court explained:

Although preemption in the liquor industry by the 

Commonwealth prevents municipalities from regulating 

local liquor establishments, it does not prevent taxation 

under a specific enabling act expressly giving the 

authorization to tax liquor or malt and brewed beverages. 

Where the power is with the legislature to preempt a field, 
15

the legislature also has the power to make exceptions by 

expressly giving a municipality the power to tax under 

defined circumstances. Also, preemption, as a judicial 

doctrine, is only relevant where the legislature is silent 

about whether a municipality may regulate the field.

However, in this instance, the legislature was not silent as to 

local taxation; it specifically authorized the [c]ity to impose 

this liquor-by-the-drink tax. 

Licensed Beverage Ass’n, 669 A.2d at 451-52 (footnote omitted).

In Compton v. Zoning Hearing Board of Pennsbury Township, 708 A.2d 

871 (Pa. Cmwlth. 1998), this Court affirmed a trial court’s order vacating conditions 

on alcohol service that were imposed by the township zoning hearing board due to the 

trial court’s conclusion that the Liquor Code preempted the conditions. The zoning 

hearing board had imposed conditions pertaining to the sale of alcohol because it

considered the addition of alcohol service as a change in a nonconforming use, 

requiring the grant of a special exception. Numerous objectors appealed from the 

trial court’s decision to this Court, arguing that the 1994 Amendment and 1916 

Delaware supported their position that the conditions were not preempted.

Considering the objectors’ arguments, this Court explained:

The [C]ourt in [1916] Delaware held that zoning 

regulations prohibiting cabarets, with or without liquor 

licenses, in certain geographic location[s] within the city, 

were not pre-empted by the Liquor Code, but that 

municipalities are still limited to liquor[-]neutral zoning 

regulations. The [1916] Delaware [C]ourt discussed the 

pervasiveness of the regulation scheme controlling the 

alcoholic beverage industry, but recognized that 

municipalities could exercise appropriate zoning controls 

over liquor licensees, citing [Wilsbach] and [Wissinoming].

. . . [The o]bjectors recognize, as does this Court, that no 

other case has been decided that in any way interprets the 

1994 [A]mendment. However, we believe that the 

amendment was, in essence, codifying prior case law.

Based on the language from the [1916] Delaware opinion 

quoted above and in light of the language of the 

amendment, we hold that zoning boards may still only place 
16

conditions on uses that are liquor[-] neutral. Thus, the trial 

court’s decision striking [the] conditions . . . was proper. 

These . . . conditions were not liquor[-]neutral and invaded 

the province of the Liquor Control Board that is charged 

with the responsibility of overseeing and regulating the sale 

of alcohol.

Compton, 708 A.2d at 874.

In City of Philadelphia v. Tax Review Board of the City of Philadelphia, 

713 A.2d 718 (Pa. Cmwlth. 1998), this Court affirmed a trial court decision which 

upheld an order granting beer distributors’ refund petitions for city U & O taxes. In 

reaching its decision, this Court reviewed Wissinoming and the Supreme Court’s 

opinion in Wilsbach which the appellants, the city and the school district urged the 

Court to disregard. In rejecting the appellants’ arguments, this Court explained:

The compelling reasons to disregard Wissinoming stated by 

[the a]ppellants are that the case was wrongly decided and 

that subsequent case law has cast doubt upon its validity.

[The a]ppellants proceed with their argument as if the 

Supreme Court has not held that the General Assembly 

intended to preempt local taxation of malt and brewed 

beverage distributors in Wilsbach and has not affirmed our 

Court’s adherence to this principle in Wissinoming. Rather, 

[the a]ppellants argue that the beer distributors in this case 

had not established their entitlement to a ‘special exception’

from the U & O tax and then proceed to argue that such an 

‘exemption’ is not logical, in accordance with law, or 

supportive of the constitutional requirement that the 

[s]chool [d]istrict provide for appropriate public education.

These arguments have nothing to do with whether the 

Commonwealth has preempted local regulation and taxation 

from the field, however. The beer distributors in this case 

established their ‘exemption’ simply by reference to the 

standing law of the Commonwealth. We turn, then, to more 

recent law that [the a]ppellants argue undercuts both 

Wissinoming and Wilsbach.

[The a]ppellants first argue that the validity of Wilsbach has 

been cast into doubt by a 1994 [A]mendment to the Liquor 

Code. Section 8 of the Act of October 5, 1994, P.L. 522, 

added [Section 493.1] to the Liquor Code, providing: 
17

‘Nothing in this act shall be construed to preempt the right 

of any municipality to regulate zoning and enforce any 

other local ordinances and codes dealing with health and 

welfare issues.’ This provision, however, is silent 

concerning local taxation, and there is nothing in the section 

that indicates that the term ‘health and welfare issues’ is to 

be construed so broadly as to include taxation. In light of 

Wilsbach and Wissinoming, had the legislature intended that 

local bodies may assess local taxes against distributors of 

malt and brewed beverages it would have so plainly stated. 

Indeed, Justice Zappala, concurring in Wilsbach, expressed 

his trust that the General Assembly would correct any 

erroneous interpretation of its intent to preempt a field.

Wilsbach, . . . 519 A.2d at 404. The legislature has been 

silent as to the interpretation attributed to it in Wilsbach and 

Wissinoming. We must therefore presume that Wilsbach

and Wissinoming remain consistent with legislative intent.

Tax Review Bd., 713 A.2d at 721. This Court concluded:

We may not overturn Wilsbach. Moreover, the general 

principle espoused by a majority of Justices in Wilsbach,

that ‘the existence of comprehensive regulatory schemes’ in 

the liquor industry preempts ‘local taxation measures,’ has 

been recently restated in a majority decision of our Supreme 

Court in Cheltenham T[wp.] v. Cheltenham Cinema, Inc., . . 

. 697 A.2d 258, 260 ([Pa.] 1997). Wissinoming followed 

that principle and was affirmed by our Supreme Court. 

Therefore, any discussion of this Court’s subsequent case 

law, that does not in any way overrule Wissinoming, is of 

no avail.

Tax Review Bd., 713 A.2d at 721 (emphasis in original). Accordingly, the Court held 

that the City of Philadelphia’s U & O tax was preempted.

In City of Philadelphia v. Clement & Muller Inc., 715 A.2d 397 (Pa. 

1998), our Supreme Court considered whether, as imposed on licensed beer 

distributors, Philadelphia’s Business Privilege and Mercantile Tax was preempted by 

the Liquor Code. Although the Court acknowledged the factual similarities to 

Wilsbach, it held that, unlike the facts in Wilsbach, the tax was not preempted since 
18

the First Class City Business Tax Reform Act, Act of May 30, 1984, P.L. 345, 53 P.S. 

§§ 16181-16193, specifically provided:

Notwithstanding a contrary provision of law of 

the Commonwealth, including, but not limited 

to, the act of March 4, 1971 (P.L. 6, No. 2), 

known as the Tax Reform Code of 1971 [72 

P.S. § 7101 et seq.] . . . every person engaging 

in any business in a city of the first class . . . 

shall pay an annual tax at the rate or rates 

specified by the city council. . . .

(Emphasis added.) The meaning of the emphasized 

introductory language is straightforward: regardless of what 

any other law provides, first class cities are authorized by 

this act to collect a tax from every person engaging in any 

business within the city.

Clement & Muller, 715 A.2d at 399. In a footnote, the Court distinguished 

Wissinoming, stating:

The [a]ppellants’ argument that the decision here conflicts 

with Wissinoming . . . and Liberty Bell Racing Ass[’]n v. 

Phila[.] Tax Review B[d.], . . . 483 A.2d 1063 ([Pa. 

Cmwlth.] 1984),

[15]

. . . is based on the premise that the 

taxes in those cases were adopted pursuant to enabling acts 

‘that for all practical purposes are identical’ to the enabling 

act at issue here. Without revisiting those cases in depth, 

the flaw in this argument is readily apparent. In neither 

of those cases did the statute authorizing the local tax 

specifically do so ‘notwithstanding a contrary provision 

of law of the Commonwealth.’

Clement & Muller, 715 A.2d at 399 n.3 (emphasis added).

Most recently, in Aboud v. City of Pittsburgh Department of Planning, 

17 A.3d 455 (Pa. Cmwlth. 2011), this Court affirmed a trial court’s holding that a city 

 

15 In Liberty Bell, this Court held that a corporation conducting harness racing was not 

subject to Philadelphia’s Business Privilege and Mercantile License Tax and the School District of 

Philadelphia’s General Business Tax, where the General Assembly clearly indicated that it intended 

to preempt the harness racing field with respect to taxation and regulation.
19

zoning ordinance restricting the number of restaurants with liquor licenses in a 

particular zone was not liquor-neutral and infringed upon the PLCB’s authority. The 

zoning provision required that in a Local Neighborhood Commercial District, once a 

designated number of restaurants holding a license was exceeded, all restaurant 

applicants to obtain a liquor license must meet the zoning code’s standards for 

conditional use. 

This Court held that the zoning provision was problematic for two 

reasons. First, it treated liquor licensees differently in that it mandated additional 

hearings for licensees which resulted in more delays than a non-liquor licensee 

applicant seeking a special exemption. Further, the relevant zoning provision directly 

conflicted with the Liquor Code because it attempted to regulate the location of the 

restaurant after the PLCB issued the license. In concluding that the zoning provision 

was preempted, the Court reasoned:

Here, pursuant to the Liquor Code, the [P]LCB exercised its 

exclusive authority to review an application for a liquor 

license to sell alcohol submitted by the [licensees]. After 

written notice to interested neighbors and the [c]ity, which 

chose not to participate in the licensing proceedings, the 

[P]LCB determined that the liquor license issued to the 

[licensees] did not have a detrimental effect on the welfare, 

health, peace and morals of the neighbors of the Southside 

before the [P]LCB issued the liquor license to the

[licensees]. For the City to now claim that the [licensees] 

may not sell alcohol at their restaurant directly conflicts 

with the preemption doctrine under the Liquor Code. ‘The 

preemption doctrine establishes a priority between 

potentially conflicting laws enacted by various levels of 

government. Under this doctrine, local legislation cannot 

permit what a state statute or regulation forbids or prohibit 

what state enactments allow.’ (Emphasis added). Huntley 

& Huntley v. Borough Council of the Borough of Oakmont 

and the Borough of Oakmont, . . . 964 A.2d 855, 862 ([Pa.] 

2009). ‘Additionally, a local ordinance may not stand as an 

obstacle to the execution of the full purposes and objectives 

of the Legislature.’ Id. at . . . 863.
20

Aboud, 17 A.3d at 462.

Based on this history, the law is clear that the Liquor Code preempts the 

local U & O and business privilege taxation of liquor licensed establishments and 

taxation on liquor sales (unless the General Assembly has specifically authorized

such a tax), and zoning ordinances (unless such ordinances are liquor-neutral,

applying equally to businesses holding liquor licenses and those without). Although

as cited herein, this Court has previously considered Liquor Code preemption as it 

pertains to taxation and zoning issues, and the application of Section 493.1 of the 

Liquor Code thereto, this Court is unaware of any case addressing whether the Liquor 

Code preempts a municipal ordinance or regulation which authorizes the revocation

or denial of a business license renewal based on the licensee’s conduct in operating 

his/her establishment. 

Our Supreme Court has declared that “it is clear that the state may 

outright forbid the sale of intoxicating liquors and, if it decides to permit their sale, 

the state generally may impose such conditions as it sees fit.” St. Rd. Bar & Grille, 

Inc. v. Pa. Liquor Control Bd., 876 A.2d 346, 352 (Pa. 2005). Further, each 

individual authorized by the Commonwealth to sell liquor

is under a duty not only to regulate his own personal 

conduct in a manner consistent with the permit he has 

received, but also to control the acts and conduct of any 

employee to whom he entrusts the sale of liquor. Such 

fealty is the quid pro quo which the Commonwealth 

demands in return for the privilege of entering the highly 

restricted and, what is more important, the highly 

dangerous business of selling intoxicating liquor.

Id. at 355 (quoting Commonwealth v. Koczwara, 155 A.2d 825, 828 (Pa. 1959)

(emphasis in original)); see also Pa. State Police v. S & B Rest., Inc., 52 A.3d 513 

(Pa. Cmwlth. 2012). PLCB-licensed operations are tightly controlled under the 
21

Liquor Code and PLCB’s Regulations, which impose statutory obligations for 

virtually all aspects of the retail sale of alcohol.16

The Liquor Code is “an exercise of the police power of the 

Commonwealth for the protection of the public welfare, health, peace and morals of 

the people of the Commonwealth . . . .” Section 104(a) of the Liquor Code, 47 P.S. § 

1-104(a). Accordingly, Section 404 of the Liquor Code grants the PLCB authority to 

consider the health, welfare, peace and morals of the community when granting a 

liquor license. See 47 P.S. § 4-404(a). The Liquor Code provides several methods 

for handling nuisance establishments.17 The Pennsylvania State Police, Bureau of 

Liquor Control Enforcement may issue citations to licensees for violations of the 

 

16 See, e.g., Section 406 of the Liquor Code, 47 P.S. § 4-406 (pertaining to liquor sales by 

licensees); Section 407 of the Liquor Code, 47 P.S. § 4-407 (pertaining to malt or brewed beverage 

sales by licensees); Section 470 of the Liquor Code, 47 P.S. § 4-470 (permitting the PLCB’s Bureau 

of Licensing to object to license renewal based on, inter alia, violation of law by licensee or its 

employees, and based on the manner in which the premises is operated); Section 491 of the Liquor 

Code 47 P.S. § 4-491 (describing fifteen unlawful acts relative to liquor, alcohol and liquor 

licensees); Section 492 of the Liquor Code, 47 P.S. § 4-492 (describing twenty-one unlawful acts 

pertaining to malt or brewed beverages and licensees); Section 493 of the Liquor Code, 47 P.S. § 4-

493 (describing thirty-four unlawful acts relative to liquor, malt and brewed beverages and 

licensees); Section 498 of the Liquor Code 47 P.S. § 4-498 (pertaining to unlawful advertising); 

Section 499 of the Liquor Code, 47 P.S. § 4-499 (mandating that patrons vacate licensed premises 

not later than one-half hour after a licensee is required to cease serving alcohol); Sections 5.11-5.23 

of the PLCB’s Regulations, 40 Pa. Code §§ 5.11-5.23 (pertaining to employees of licensees); 

Sections 5.30-5.36 of the PLCB’s Regulations, 40 Pa. Code §§ 5.30-5.36 (pertaining to amusement 

and entertainment at a licensed premises); Sections §§ 5.41-5.54 of the PLCB’s Regulations, 40 Pa. 

Code §§ 5.41-5.54 (pertaining to sanitary conditions and lighting and cleaning of malt or brewed 

beverage systems); Section 5.321 of the PLCB’s Regulations, 40 Pa. Code § 5.321 (relating to 

minors on licensed premises).

17 These remedies are in addition to Liquor Code provisions permitting citation and

revocation, suspension and/or fines for Liquor Code and PLCB Regulation violations and for 

“other sufficient cause shown.” Section 471(a) of the Liquor Code, 47 P.S. § 4-471(a) (emphasis 

added). “Courts have interpreted Section 471 of the Liquor Code as providing similar authority for 

the imposition of penalties for a variety of conduct not expressly prohibited by the Liquor 

Code, but reasonably related to the sale and use of alcoholic beverages, including gambling.” 

P[a.] State Police, Bureau of Liquor Control Enforcement v. Harrisburg Knights of Columbus 

Home Ass'n, 989 A.2d 39, 44 (Pa. Cmwlth. 2009) (emphasis added).
22

Liquor Code or PLCB Regulations. Further, Section 470(a.1) of the Liquor Code18

authorizes the PLCB to refuse to renew a license:

19

(1) if the licensee, its shareholders, directors, officers, 

association members, servants, agents or employes have 

violated any of the laws of this Commonwealth or any of 

the regulations of the [PLCB];

(2) if the licensee, its shareholders, directors, officers, 

association members, servants, agents or employes have 

one or more adjudicated citations under this or any other 

license issued by the [PLCB] . . . ;

. . . .

(4) due to the manner in which this or another licensed 

premises was operated while the licensee, its 

shareholders, directors, officers, association members, 

servants, agents or employes were involved with that 

license. When considering the manner in which this or 

another licensed premises was being operated, the board 

may consider activity that occurred on or about the 

licensed premises or in areas under the licensee’s control 

if the activity occurred when the premises was open for 

operation and if there was a relationship between the 

activity outside the premises and the manner in which 

the licensed premises was operated. The [PLCB] may 

take into consideration whether any substantial steps were 

taken to address the activity occurring on or about the 

premises.

47 P.S. § 4-470(a.1) (emphasis added). Pursuant to Section 464 of the Liquor Code,20

PLCB nonrenewal decisions are reviewed by a trial court de novo. In addition, 

Section 611 of the Liquor Code permits certain parties, including municipalities, to 

bring nuisance actions in county common pleas courts against liquor licensees. 

Section 611 of the Liquor Code provides, in pertinent part:

 

18 Section 470(a.1) of the Liquor Code was added by the Act of December 21, 1998, P.L. 

1202, No. 155.

19

 Restaurant liquor licensees must renew their licenses every two years.

20 47 P.S. § 4-464.
23

(a) Any room, house, building, boat, vehicle, structure or 

place, except a private home, where liquor, alcohol or malt 

or brewed beverages are manufactured, possessed, sold, 

transported, offered for sale, bartered or furnished, or stored 

in bond, or stored for hire, in violation of this act, and all 

such liquids, beverages and property kept or used in 

maintaining the same, are hereby declared to be common 

nuisances, and any person who maintains such a common 

nuisance shall be guilty of a misdemeanor and, upon 

conviction thereof, shall be subject to the same penalties 

provided in section four hundred ninety four of [the Liquor 

Code].

(b) An action to enjoin any nuisance defined in this act may 

be brought in the name of the Commonwealth of 

Pennsylvania by the Attorney General, by the Pennsylvania 

State Police through its Bureau of Liquor Control 

Enforcement, by the municipality wherein the 

establishment is located, by the district attorney of the 

proper county or by a person who resides or has a place of 

business within five hundred feet of the location of the 

alleged nuisance. Such action shall be brought and tried as 

an action in equity and may be brought in any court having 

jurisdiction to hear and determine equity cases within the 

county in which the offense occurs. If it is made to appear, 

by affidavit or otherwise, to the satisfaction of the court that 

such nuisance exists, a temporary writ of injunction shall 

forthwith issue, restraining the defendant from conducting 

or permitting the continuance of such nuisance until the 

conclusion of the proceedings. If a temporary injunction is 

prayed for, the court may issue an order restraining the 

defendant and all other persons from removing or in any 

way interfering with the liquids, beverages or other things 

used in connection with the violation of this act constituting 

such nuisance. . . . It shall not be necessary for the court to 

find the property involved was being unlawfully used, as 

aforesaid, at the time of the hearing, but on finding that the 

material allegations of the petition are true, the court shall 

order that no liquor, alcohol or malt or brewed beverage 

shall be manufactured, sold, offered for sale, transported, 

bartered or furnished, or stored in bond, or stored for hire in 

such room, house, building, structure, boat, vehicle, or 

place, or any part thereof.

47 P.S. § 6-611 (emphasis added).
24

Relying on Section 493.1 of the Liquor Code, the City contends that it 

has authority to deny Licensee’s License renewal based on Licensee’s operations, 

where the result is the cessation of a PLCB-licensed business subject to the 

legislature’s pervasive regulatory scheme governing liquor licensee operations. 

Specifically, it argues that its ordinance permitting the nonrenewal of the License is a 

“local ordinance[] . . . dealing with health and welfare issues[,]” 47 P.S. § 4-493.1(a), 

since the operation of a nuisance establishment impacts the health and welfare of the 

community. It strongly urges this Court to consider the ordinance a “health and 

welfare [matter], and not a taxation matter.” City Br. at 19.21 The City further 

represents that the General Assembly granted it the authority to impose such a 

licensing requirement. The City is a third class city under the Third Class City Code 

(Code).22 Section 12601.1(a) of the Code provides that “[c]ouncil may, by ordinance, 

designate the types or kinds of businesses or occupations located or carried out within 

the city that are subject to annual registration with the city[,]” and permits the City to 

impose a nominal annual fee for administration of the registration program. 11 

Pa.C.S. § 12601.1(a). In accordance therewith, the Ordinance requires a person or 

entity operating a business within the City to obtain a license. Section 12654 of the 

Code provides:

This chapter shall not be construed to relieve a person from 

the duty of taking out a license or from the payment of any 

license tax or fee imposed or authorized by any other 

statute, nor shall any Commonwealth license tax or fee 

preempt the registration, licensure or regulatory powers 

 

21 Despite the City’s characterization, the Ordinance section authorizing the City’s action is 

contained in the Chapter titled “Business Privilege and Mercantile Tax.” Ordinance, Chapter 5-715. 

The tax itself was already found by our Supreme Court to be inapplicable to businesses holding 

liquor licenses. See Wilsbach.

22 11 Pa.C.S. §§ 10101-14702.
25

of a city in accordance with this chapter,

[23] unless the 

preemption is expressly authorized.

11 Pa.C.S. § 12654 (emphasis added). The City operates under Article IV of the 

Charter Law, known as the “mayor-council plan A” structure. Section 401 of the 

Charter Law, 53 P.S. § 41401. Section 304 of the Charter Law states:

The general grant of municipal power contained in this 

article is intended to confer the greatest power of local selfgovernment consistent with the Constitution of this State. 

Any specific enumeration of municipal powers contained in 

this act or in any other law shall not be construed in any 

way to limit the general description of power contained in 

this article, and any such specifically enumerated municipal 

powers shall be construed as in addition and supplementary 

to the powers conferred in general terms by this article. All 

grants of municipal power to cities governed by an optional 

plan under this act, whether in the form of specific 

enumeration or general terms, shall be liberally construed in 

favor of the city.

53 P.S. § 41304.

Importantly, none of the statutory provisions the City cites for its 

purported authority to impose license nonrenewal on liquor licensees, specifically 

authorizes regulation or taxation of liquor, or liquor licensed establishments. See, 

e.g., Licensed Beverage Ass’n; Clement & Muller. Further, unlike the facts in 1916 

Delaware, Regulation 109 is not a zoning ordinance. Instead, it is a regulation 

designed specifically to govern the operation of businesses and to impose 

consequences, authorizing the Appeal Board to terminate operating authority when it

 

23 Section 12654 of the Code is contained in Chapter 126 of the Code. Apart from the 

registration of businesses under Section 12601.1, that chapter provides for the regulation of motor 

vehicles (11 Pa.C.S. § 12602); Licensing of Plumbers (11 Pa.C.S. § 12603); regulation of transient 

merchants (11 Pa.C.S. § 12604); regulation of special events (11 Pa.C.S. § 12605); regulation of 

parking lot and parking garage operators (11 Pa.C.S. § 12650); regulation of farmers (11 Pa.C.S. § 

12651); regulation of insurance business (11 Pa.C.S. § 12652); and regulation of persons taking 

orders by samples (11 Pa.C.S. § 12653). Notably, the only regulatory powers referenced in Chapter 

126 of the Code pertain to the aforementioned subjects. There are no regulations in Chapter 126 of 

the Code pertaining to the manner of operation of a bar or restaurant.
26

determines the business license holder’s operations constitute a nuisance. As it 

pertains to liquor licensees, Regulation 109 grants to the mayor and the Appeal Board 

the authority to regulate liquor licensees’ activities, notwithstanding that the General 

Assembly, in the Liquor Code, granted such authority to the PLCB, the Pennsylvania 

State Police, and the trial court. The City’s denial of Licensee’s 2016 License 

renewal also effectively overrides the Commonwealth’s affirmative grant of authority 

to Licensee to sell alcoholic beverages. Moreover, the City’s interpretation affords its 

Appeal Board’s nonrenewal decision relative to a liquor licensee more deference

under the Local Agency Law than that of the PLCB which, under the Liquor Code, is 

granted no deference in a nonrenewal matter by a reviewing trial court. See 47 P.S. § 

4-464. 

The City argues that ameliorating a nuisance is a “health and welfare 

issue[,]” for which Section 493.1 of the Liquor Code authorizes local involvement. 

However, since Section 104 of the Liquor Code describes the Liquor Code’s purpose 

as “an exercise of the police power of the Commonwealth for the protection of the

public welfare, health, peace and morals of the people of the Commonwealth . . . ,”

any Liquor Code provision could be interpreted to involve “health and welfare 

issues.” 47 P.S. § 1-104 (emphasis added). Taking the City’s rationale to its logical 

end, Section 493.1 of the Liquor Code would permit a municipality to legislate and 

override any provision of the Liquor Code, and would thereby allow the exception to 

swallow the rule.

The well-established law is that the Liquor Code cannot preempt liquorneutral health and welfare related ordinances, such as health and fire codes. 

However, given the pervasive nature of the Liquor Code over every aspect of the 

day-to-day operations of a liquor licensed establishment, especially in regulating a 

licensee’s alleged nuisance, this Court declines to interpret Section 493.1 of the 

Liquor Code to permit the invasive municipal control at issue here by including such
27

within the definition of “health and welfare[.]” 47 P.S. § 4-493.1. The practical 

impact of upholding the Ordinance and permitting the City to deny renewal of 

Licensee’s License possibly, and most likely, based on the same incidents the PLCB 

considered to be insufficient to deny renewal of the Licensee’s liquor license,

demonstrates the Ordinance’s meddlesome intrusion into the highly-regulated area of 

liquor distribution and sales. Section 611 of the Liquor Code explicitly permits 

municipalities to seek the closure of nuisance liquor licensed premises. For reasons 

not evident in the record, the City did not pursue Licensee’s closure thereunder. We 

do not believe the General Assembly intended to permit a municipality to achieve 

that result through other means.24

For all of the above reasons, the trial court’s order is affirmed.

___________________________

ANNE E. COVEY, Judge

 

24 Given our disposition of the first issue, we need not address the remaining issues.
IN THE COMMONWEALTH COURT OF PENNSYLVANIA

1400 North Third Street :

Enterprises, Inc. :

:

v. :

:

The City of Harrisburg :

License and Tax Appeal Board, : No. 1363 C.D. 2016

Appellant :

O R D E R

AND NOW, this 29th day of November, 2017, the Dauphin County 

Common Pleas Court’s July 11, 2016 Order is affirmed.

___________________________

ANNE E. COVEY, Judge