IN THE COMMONWEALTH COURT OF PENNSYLVANIA

Core Equity II, L.P., 114 Chestnut :

Street, Philadelphia, Pennsylvania :

19105 and Delaware Ave Outdoor, :

LLC, 3400 West Chester Pike, :

Suite 100 Newtown Square, :

Pennsylvania 19073, :

:

Petitioners :

:

v. : No. 257 M.D. 2017

: Argued: March 6, 2018

Commonwealth of Pennsylvania, :

Department of Transportation, :

700 Geerdes Boulevard, :

King of Prussia, Pennsylvania 19406, :

:

Respondent :

BEFORE: HONORABLE RENÉE COHN JUBELIRER, Judge

HONORABLE P. KEVIN BROBSON, Judge

HONORABLE MICHAEL H. WOJCIK, Judge

OPINION NOT REPORTED

MEMORANDUM OPINION 

BY JUDGE WOJCIK FILED: August 14, 2018

Before the Court is the application for summary relief filed by the 

Pennsylvania Department of Transportation (DOT) to the petition for review seeking 

declaratory relief filed in our original jurisdiction by Core Equity II, L.P. (Core) and 

Delaware Ave Outdoor, LLC (Delaware) (collectively, Petitioners). We deny the 

application.
2

The petition for review alleges the following, in relevant part. Pursuant 

to Section 131 of the federal Highway Beautification Act,1states are required to 

maintain effective control of outdoor advertising devices (OADs) along federal 

highways. On June 10, 1974, DOT’s Secretary certified to the Secretary of the 

United States Department of Transportation that the City of Philadelphia (City) had 

established sufficient and acceptable regulations concerning OADs, and that

certification was formalized in an agreement between DOT and the City on July 1, 

1974. Based on the certification, the City’s regulations, together with the City’s 

 

1

23 U.S.C. §131. As this Court has explained:

When it enacted the Highway Beautification Act in 1965, Congress 

found and declared that

the erection and maintenance of outdoor advertising signs, 

displays, and devices in areas adjacent to the Interstate 

system and the primary system should be controlled in order 

to protect the public investment in such highways, to 

promote the safety and recreational value of public travel, 

and to preserve natural beauty.

Section 131(a) of the Highway Beautification Act[, 23 U.S.C. 

§131(a)]. States which failed to comply with the Highway 

Beautification Act faced a reduction in federal highway funding. 

[See Section 131(b) of the Highway Beautification Act, 23 U.S.C. 

§131(b).] The federal regulation provides states with discretion to 

permit pre-existing signs which do not comply with the provisions 

of state law and regulations to remain for the duration of their 

normal life. The federal regulation then requires the state to develop 

criteria to determine when the normal life has ended due to 

destruction, abandonment or discontinuance but gives the individual 

state discretion as to what criteria it uses to define destruction, 

abandonment or discontinuance. See, generally, 23 C.F.R. 

§750.707 (1993). . . . 

Martin Media v. Department of Transportation, 641 A.2d 630, 632, n.4 (Pa. Cmwlth. 1994).
3

operating procedures for issuing permits,2supplanted DOT’s jurisdiction over OADs 

in the City as conferred by the Pennsylvania Outdoor Advertising Control Act of 

 

2 Section 9-602(3) and (4) of the Philadelphia Code states, in relevant part:

 (3) No person shall erect or maintain any outdoor advertising sign 

unless he or she has obtained a license for such sign from the 

Department. Applications for such licenses shall be made on a form 

provided by the Department. Such licenses shall be issued and 

renewed for terms of five years. A single license shall be issued for 

multiple signs that share a common sign support structure.

 (4) Licenses for Outdoor Advertising Signs. No license shall be 

issued or renewed unless:

 (a) The Department finds that the outdoor advertising signs and 

their sign support structures, if any, which are proposed to be erected 

or which are erected or maintained are to be, or have been 

constructed in conformity with all codes and that all proper permits, 

including any required zoning permits, have been secured.

 (b) To the extent that the applicant . . . proposes to erect or maintain 

a sign or sign structure which extends in any manner into or above 

a public street, highway or right-of-way, the applicant . . . agrees to 

comply with the terms of the license and to indemnify the City 

against any liability by reason of granting the license, and files a 

continuing bond for the sign satisfactory to the Law Department, 

and obtains any necessary approval from City Council for an 

encroachment into the public right-of-way.

 (c) The applicant pays a license fee . . . .

 (d) The applicant submits to the Department with its license 

application an inventory listing each outdoor advertising sign 

structure that the applicant owns or maintains in the City. . . .

 (e) The applicant does not have any outstanding violations, for 

which all legal appeals have been exhausted, nor any outstanding 

court orders requiring the removal of any sign(s) for which all legal 
4

1971 (Act).

3

 On April 13, 2015, DOT revoked the City’s certification transferring 

jurisdiction under the Act to DOT.

 

appeals have been exhausted, for erecting and/or maintaining 

outdoor advertising signs in violation of The Philadelphia Code.

 (f) The applicant . . . affixes on each sign and/or sign structure 

information indicating the owner of the sign and (if applicable) the 

individual or company responsible for erecting and/or maintaining 

the sign and/or sign structure.

 (g) The applicant, the owner of the sign, and the owner of the 

premises upon which the sign is placed or to be placed are current 

in the payment of all City and School District taxes or have entered 

into an agreement(s) to pay any delinquent taxes and are abiding by 

the terms of such agreement(s).

Phila., Pa. Code §9-602(3)-(4) (2005, 2015).

3 Act of December 15, 1971, P.L. 596, as amended, 36 P.S. §§2718.101-2718.115. Section 

5(b) and (d) of the Act states, in relevant part:

(b) In zoned commercial or industrial areas, the secretary may certify 

to the Secretary of Transportation of the United States as notice of 

effective control, that there has been established within such areas 

regulations which are enforced with respect to the size, lighting and 

spacing of outdoor advertising devices. In such areas, the size, 

lighting and spacing requirements set forth below shall not apply. 

* * *

(d) . . . At any time, that a political subdivision adopts regulations 

which include the size, spacing and lighting of outdoor advertising 

devices, the secretary may so certify to the Secretary of 

Transportation of the United States and control of outdoor 

advertising in commercial or industrial areas will transfer to 

subsection (b) under this section.

36 P.S. §2718.105(b), (d). 
5

Core is a limited partnership that owns a building located at 1000 

Frankford Avenue in the City. On March 17, 2015, prior to the revocation of the 

certification, the City issued Permit No. 596034 (OAD Permit), approving Core’s 

application to construct three 14’ by 48’ accessory digital rooftop OADs4to display 

advertising on its property along Interstate 95. On November 12, 2015, the City 

issued Building Permit No. 645378 to construct two rooftop OADs on the property 

and construction of the OADs was completed prior to February 22, 2016.

On July 16, 2015, Core and Delaware entered into a Digital Display 

Lease Agreement (Agreement) under which Core leased office space in the building 

and a portion of the building rooftop for the construction, maintenance, operation, 

and leasing of OADs to Delaware. Delaware spent $975,000.00 to design, plan, and 

construct the OADs. Per the Agreement, Delaware subleased office space to third 

parties in the building that also had the right to use the OADs to advertise their 

businesses. When in operation, the OADs display advertising relating to the 

businesses of the sublessees.

 

4 Section 9-602(2)(a) of the Philadelphia Code defines “Accessory Sign” as follows:

A sign which directs attention to information, identification, or 

advertisements strictly incidental to a lawful use of the premises on 

which it is located. This includes signs or devices indicating the 

business transacted, services rendered, goods sold, or produced on 

the premises; and, name or emblem of a person, firm, institution, 

organization or activity occupying the premises.

Phila., Pa. Code §9-602(2)(a) (2005). In turn, Section 9-602(2)(c) defines “Non-Accessory Sign” 

as “[a] sign which directs attention to a business, industry, profession, commodity, service 

organization, activity, institution, business, product or entertainment neither sold, located nor 

offered upon the property where the sign is situated.” Phila., Pa. Code §9-602(2)(c) (2005).
6

On December 3, 2015, the Federal Highway Administration approved 

DOT’s transition plan to take control of the review, approval, and permitting of 

OADs adjacent to state and federal highways in the City away from the City. As 

part of the transition plan, DOT was required to create an inventory of existing signs 

that are adjacent to state and federal highways in the City prior to July 1, 2016.

On February 22, 2016, Core submitted an application to DOT for an 

on-premise OAD5 with respect to the existing OADs as part of DOT’s duty to create 

 

5 Section 6 of the Act states, in pertinent part, that “[t]he secretary is authorized to 

promulgate rules and regulations governing [OADs] . . . .” 36 P.S. §2718.106. The regulations 

promulgated under Section 6 of the Act are found at 67 Pa. Code §§445.1–445.9. Section 445.5(a) 

of DOT’s regulations, relating to on-premise OADs, states that “[t]his section applies to signs 

which: (1) Advertise the sale or lease of the premises on which they are located[; and] (2) 

Advertise activities conducted on the premises on which they are located.” 67 Pa. Code §445.5(a). 

In turn, Section 445.2 defines “premises,” in relevant part, as follows:

The property upon which the activity is conducted as determined by 

physical facts rather than property lines. It is the land occupied by 

the buildings or other physical uses that are necessary or customarily 

incident to the activity. . . . The following are not considered to be 

a part of the premises on which the activity is conducted, and any 

signs located on the land are to be considered off-premise 

advertising:

 (i) Land which is not used as an integral part of the principal 

activity, including land which is separated from the activity by a 

roadway, highway or other obstruction, and not used by the activity 

. . . .

 (ii) Land which is used for, or devoted to, a separate purpose 

unrelated to the advertised activity.

 (iii) Land which is more than 100 feet from the principal activity, 

and in closer proximity to the highway than to the principal activity, 

and developed or used only in the area of the sign site or between 

the sign site and the principal activity and whose purpose is for 

advertising purposes only.
7

a database of OADs in the City under the transition plan.

6

 On April 13, 2016, DOT 

denied the application because the OAD did not qualify as an on-premise OAD under 

DOT’s regulations because it displayed off-premise advertising.

As a result, on April 12, 2017, Core appealed the denial of the onpremise application to DOT’s Administrative Docket and a hearing was scheduled 

for April 24, 2017. However, on April 21, 2017, Core withdrew the appeal and 

requested that the matter be discontinued; DOT’s hearing officer issued an order 

cancelling the hearing and marking the matter as discontinued and ended.

On May 2, 2017, Core submitted an application for a nonconforming7

off-premise OAD. DOT denied the application on May 12, 2017, and directed that 

 

67 Pa. Code §445.2.

6

See also Section 7 of the Act, 36 P.S. §2718.107 (“An annual permit shall be required for 

each [OAD] regulated by this act and located outside the limits of those incorporated 

municipalities that have legally established and operating procedures for issuing permits for such 

[OADs] which have been certified by the secretary as conforming to the provisions of subsection 

(d) of section 5 of this act.”); Section 445.6(a)(4) of DOT’s regulations, 67 Pa. Code §445.6(a)(4) 

(“An annual permit shall be required for signs regulated under the act and this section, including . 

. . [s]igns prohibited to be erected or maintained under section 4 of the act (36 P.S. §2718.104), 

until such time as each sign has been removed; provided, however, that a permit may not be 

required for signs in commercial or industrial zones, certified by the Secretary to the Secretary of 

Transportation of the United States under section 5(b) and (d) of the act (36 P.S. §2718.105(b) and 

(d)), if the local political subdivision has a legally established and operating procedure for issuing 

the permits.”).

7

“Nonconforming signs” are those which were legal when erected but which do not now 

conform to the requirements of the Act. Mike’s Sign Company v. Department of Transportation, 

642 A.2d 634, 635 n.2 (Pa. Cmwlth. 1994). See also Section 445.2 of DOT’s regulations, 67 Pa. 

Code §445.2 (defining “nonconforming sign” as “[a] sign which was legally erected but which 

does not conform to the requirements of the act”); Section 750.707(b) of the federal regulations, 

23 C.F.R. §750.707(b) (defining “nonconforming sign” as “a sign which was lawfully erected but 

does not comply with the provisions of State law or State regulations passed at a later date or later 

fails to comply with State law or State regulations due to changed conditions”).
8

the OADs be removed in 30 days. On June 12, 2017, Core appealed the denial of 

the off-premise application to DOT’s Administrative Docket and the appeal is 

pending.

On June 9, 2017, Core then filed the instant petition for review8seeking 

an order declaring: (1) the OAD Permit was timely and lawfully obtained from a 

certified and authorized City department; (2) the OAD Permit satisfies all applicable 

statutory and regulatory requirements for the erection and operation of OADs in the 

City; (3) Petitioners have legally vested rights to own, maintain, and operate the 

accessory OADs consistent with the OAD Permit; (4) DOT must recognize 

Petitioners’ vested rights with respect to the OADs; and (5) the continued use of the 

OADs under the OAD Permit is a preexisting, lawful, nonconforming use to the 

extent that they do not conform to DOT’s regulations.

On July 20, 2017, DOT filed an Answer and New Matter arguing, inter 

alia, that this Court was without jurisdiction to entertain Core’s declaratory 

judgment action because Core failed to exhaust its available and adequate 

administrative remedy with respect to the OADs. On October 10, 2017, DOT filed 

the instant application for summary relief,

9 again seeking dismissal of Core’s petition 

 

8 The purpose of the Declaratory Judgments Act (DJA), 42 Pa. C.S. §§7531-7541, “is to 

settle and afford relief from uncertainty and insecurity with respect to rights, status, and other legal 

relations” between parties and, to that end, “is to be liberally construed and administered.” Section 

7541(a) of the DJA, 42 Pa. C.S. §7541(a); Fidelity Bank v. Pennsylvania Turnpike Commission, 

444 A.2d 1154, 1159 (Pa. 1982). 

9 Pa. R.A.P. 1532(b) states, “At any time after the filing of a petition for review in an . . . 

original jurisdiction matter the court may on application enter judgment if the right of the applicant 

thereto is clear.” “An application for summary relief is to be granted only if there are no material 

factual disputes and the movant’s entitlement to relief is clear. In the determination, the factual 

averments and the existing record are assessed in the light most favorable to the nonmoving party.” 

Northwestern Youth Services, Inc. v. Department of Public Welfare, 66 A.3d 301, 309 n.11 (Pa. 

2013) (citations omitted).
9

for review based on Core’s failure to exhaust its available and adequate 

administrative remedy with respect to DOT’s denial of its permit application and 

asserting that Core has no claim for “vested rights” in a DOT permit that it has never 

obtained.

As the Supreme Court has explained:

The doctrine of exhaustion of administrative 

remedies requires a party to exhaust all adequate and 

available administrative remedies before the right of 

judicial review arises. The doctrine is a court-made rule 

intended to prevent premature judicial intervention into 

the administrative process. A court is “[t]o defer judicial 

review where the question presented is one within an 

agency specialization and where the administrative 

remedy is likely to produce the desired result.” The 

doctrine operates as a restraint on the exercise of a court’s 

equitable powers and a recognition of the legislature’s 

direction to comply with statutorily-prescribed remedies.

Empire Sanitary Landfill, Inc. v. Department of Environmental Resources, 684 A.2d 

1047, 1053 (Pa. 1996) (citations omitted).10 “Moreover, as [the Supreme Court] 

recognized in Borough of Green Tree [v. Board of Property Assessments, Appeals 

and Review of Allegheny County, 328 A.2d 819, 824 (Pa. 1974)], the rule requiring 

the exhaustion of statutory remedies need not apply where ‘the administrative 

 

10 See also Gardner v. Department of Environmental Resources, 658 A.2d 440, 445 (Pa. 

1995) (“Exhaustion, however, is more concerned with agency autonomy, requiring resort to 

administrative processes so as to assure that agency decision making is not unduly disrupted. The 

exhaustion doctrine is a rule of judicial administration created under the inherent powers of the 

court which has since been incorporated in legislation requiring that statutorily prescribed 

remedies be strictly pursued. The doctrine of exhaustion prohibits prospective parties to 

administrative agency actions from bypassing that process and challenging the administrative 

action directly in the courts. The reasons for requiring exhaustion are that it is more efficient to 

allow an agency to proceed uninterrupted until its conclusion so that it can find facts, apply its 

expertise and exercise its discretion. The doctrine also allows agencies the opportunity to correct 

their own mistakes.”) (citations omitted).
10

process has nothing to contribute to the decision of the issue and there are no special 

reasons for postponing its immediate decision.’” Office of the Governor v. Donohue, 

98 A.3d 1223, 1235 (Pa. 2014).

In this case, Core is seeking declaratory relief regarding the rights that 

were obtained under the OAD Permit and the Building Permit that the City issued 

pursuant to its prior authority to control the review, approval, and permitting of 

OADs in the City, and the current status of the instant OADs constructed thereunder,

before the Federal Highway Administration approved the transfer of such authority

and regulation to DOT. With respect to the OAD Permit that the City validly issued 

herein, pursuant to Section 9-602(3) of the Philadelphia Code, “[s]uch licenses shall 

be issued and renewed for terms of five years,” Phila., Pa. Code §9-602(3) (2005),

so the OAD Permit at issue is initially valid until March 2020 and not due for renewal 

until that time. Additionally, Section 9-602(4)(a) of the Philadelphia Code states, in 

relevant part, “No license shall be issued or renewed unless . . . [t]he Department

finds that the Outdoor advertising signs and their sign support structures, if any, 

which are proposed to be erected or which are erected or maintained are to be, or 

have been constructed in conformity with all codes and that all proper permits, 

including any required zoning permits, have been secured.” Phila., Pa. Code §9-

602(4)(a) (2015). Further, Section 9-602(9)(a) provides that “whenever any sign is 

erected and/or maintained in violation of the provisions of this Chapter or of the 

regulations promulgated under it, the Department of Licenses and Inspections shall 

serve written notice of such violations upon the violator, directing compliance within 

thirty (30) days of the receipt of the notice of violation.” Phila., Pa. Code §9-

602(9)(a) (2005).
11

Because DOT was not the entity empowered to determine whether the 

City’s OAD Permit and Building Permit should have been issued in the first instance 

under the Philadelphia Code, or whether the OADs constructed thereunder complied 

with the relevant provisions of the Philadelphia Code, or what rights were conferred 

thereby, “‘the administrative process has nothing to contribute to the decision of the 

issue and there are no special reasons for postponing its immediate decision.’” 

Donohue, 98 A.3d at 1235. In sum, DOT’s disposition of Core’s applications for 

permits for either on-premise or off-premise OADs through its application of the 

relevant provisions of the Act and its own regulations do not resolve the ultimate 

questions at issue in the instant petition for declaratory relief relating to the 

provisions and application of the Philadelphia Code, so the exhaustion doctrine does 

not preclude the instant action in this Court.11 

Accordingly, the application for summary relief is denied.

MICHAEL H. WOJCIK, Judge

 

11 DOT’s reliance on Philadelphia Outdoor Advertising v. Department of Transportation, 

690 A.2d 789 (Pa. Cmwlth. 1997), Besko Outdoor Media v. Department of Transportation (Pa. 

Cmwlth., No. 316 M.D. 2017, filed October 19, 2017), and Rusek v. Department of Transportation

(Pa. Cmwlth., No. 459 C.D. 2008, filed August 29, 2008), is misplaced. Unlike the instant matter, 

none of those cases involved the issuance of an existing valid OAD Permit and a Building Permit 

by a local political subdivision under its own ordinance to which DOT had ceded control of OADs 

pursuant to Section 5 of the Act.
IN THE COMMONWEALTH COURT OF PENNSYLVANIA

Core Equity II, L.P., 114 Chestnut :

Street, Philadelphia, Pennsylvania :

19105 and Delaware Ave Outdoor, :

LLC, 3400 West Chester Pike, :

Suite 100 Newtown Square, :

Pennsylvania 19073, :

:

Petitioners :

:

v. : No. 257 M.D. 2017

: 

Commonwealth of Pennsylvania, :

Department of Transportation, :

700 Geerdes Boulevard, :

King of Prussia, Pennsylvania 19406, :

:

Respondent :

O R D E R

AND NOW, this 14th day of August, 2018, the Application for 

Summary Relief of the Commonwealth of Pennsylvania, Department of 

Transportation, is DENIED.

__________________________________

MICHAEL H. WOJCIK, Judge