Court Opinion

ID: 9631491
Source: CourtListenerOpinion
Date Created: 2023-08-22 10:40:00.384499+00
Date Added: 2024-06-11T18:07:55.081917
License: Public Domain

Justice NIGRO,
dissenting.
In my view, the majority’s analysis confuses the legal standards relating to tax immunity and tax exemption, misinterprets Delaware County Solid Waste Authority v. Berks County Board of Assessment Appeals, 534 Pa. 81, 626 A.2d 528 (1993), and fails to accord adequate weight to the real estate leasing power specifically conferred on SEPTA by the General Assembly. I believe that a proper analysis, consistent with the legislature’s apparent intent to remove “the impediment local taxation would represent to the successful operation of this distressed transportation system,” Southeastern Pa. Transp. Auth. v. Board for Assessment & Revision of Taxes, 13 Pa.Cmwlth. 207, 319 A.2d 10, 13 (1974), compels the conclu*721sion that the property leased by SEPTA is immune from taxation.
The majority claims to reach its conclusion that SEPTA is not immune by clarifying, then applying, the legal standards governing tax immunity. Instead of clarifying these standards, however, the majority materially alters them, improperly blending those standards with the separate and distinct standards applicable in the tax exemption context. Specifically, although the majority properly states at the outset of its analysis that the “public purpose” test applicable in the tax exemption context has no place in an immunity analysis, op. 715, it then contradicts itself by adding a new consideration to the immunity analysis that is barely distinguishable from the “public purpose” test, that is, “whether the property was acquired or used for a purpose that is within the operation of the agency.” Op. at 716. The majority appears to claim that this new consideration is mandated by Delaware County, yet the only discussion in that case regarding the use of the real estate in the agency’s operations is sheer dicta. See 826 A.2d at 532 (stating that concerns regarding the public use of the property are not “implicated by the instant facts”). Indeed, had the requirement the majority announces today been applied in Delaware County, it would have compelled a different result, as the Delaware County court made clear that the real estate at issue in that case was not “acquired or used for a purpose that is within the operation of the agency.” See id. at 530, 532 (stating that the real estate subjected to attempted taxation was “not essential” either to the agency’s operations or to a required environmental buffer zone, but nevertheless holding that such real estate is immune). Accordingly, in my opinion, Delaware County plainly does not provide support for the majority’s implementation of this new immunity constraint.
In truth, this Court’s holding in Delaware County was clear and unmistakable: that immunity applies as long as the relevant government entity has not acted outside its “authorized purposes or powers.” See id. at 532 (“In the present case, the acquisition of land to operate a landfill was within the
*722municipal authority’s stated purposes and powers.... Thus, the Authority has not acted outside its authorized purposes or powers, and has not forfeited its tax immunity status.” (emphases added)); see also id. at 531 (“If an agency acts outside its authorized governmental purposes, then its immunity is not automatic.” (emphasis added)); id. at 532 (“property which is not acquired or used for authorized governmental purposes will not enjoy governmental immunity;” “immunity covers property that was acquired or used for an authorized purpose ” (emphases added)). Thus, the question in this case is simply whether SEPTA acted within its “authorized purposes or powers” when it leased its excess office space. Id. at 532. The answer is clearly yes, as the General Assembly has specifically empowered SEPTA to lease such real estate as a means to raise revenue and reduce expenses:
§ 1741. General powers
(a) Powers enumerated. — An authority shall have and may exercise all powers necessary or convenient for the carrying out of the purposes of this chapter, including the following rights, powers and duties:
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(12) To acquire by purchase, gift or otherwise, hold, lease as lessee and use any franchise, right or property, real, personal or mixed, tangible or intangible, or any interest or right therein necessary, desirable or useful for carrying out the purposes of the authority; to sell, lease as lessor, transfer, dispose of or otherwise convey any franchise, right or property, real, personal or mixed, tangible or intangible, or any interest or right therein, at any time acquired by it; or to exchange the same for other property or rights which are useful for its purposes.
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(24) To explore alternative means of raising revenue or reducing expenses, including, but not limited to, real estate leases and rentals, equipment leases and rentals, contracting of services, the solicitation of competitive bids *723and the awarding of contracts to the highest responsive, responsible bidder for both interior and exterior advertising on all authority equipment on which the public is charged a fare for riding....
74 Pa.C.S. § 1741 (emphases added).1
Therefore, as the General Assembly has specifically empowered SEPTA to lease real estate, and because such leasing carries out the authorized governmental purpose of raising revenue and reducing expenses, I would hold that the property leased by SEPTA is immune from taxation.2 Accordingly, I respectfully dissent.

. In addition to the direct authorization of SEPTA's leasing activities, it is also worth noting the General Assembly's general prohibition of local taxation of SEPTA, even though that prohibition appears to be applicable only in the exemption context. See 74 Pa.C.S. § 1781 (“such an authority shall not be required to pay any taxes or assessments of any kind or nature whatsoever, now in existence or to be enacted in the future, whether imposed by the Commonwealth or by any government agency upon any property or the income therefrom acquired or used or permitted to be used by an authority...."); cf. Delaware County Solid Waste Auth., 626 A.2d at 531 (quoting nearly identical exemption statute in now-repealed Municipal Authority Act, 53 P.S. § 318, and concluding that such language “evinces a legislative intent to reaffirm the long standing rule that property owned by a municipal authority should not be taxed").

. Moreover, even assuming for the sake of argument that there is some sort of “public purpose" inquiry in the immunity analysis, I would find that SEPTA's leasing of real estate falls within its statutory purpose because the General Assembly has specifically included leasing within SEPTA’s purpose and has broadly defined that purpose to include activities beyond SEPTA's core transit function. See 74 Pa.C.S. § 1711(a) ("An authority shall exist for the purpose of planning, acquiring, holding, constructing, improving, maintaining, operating, leasing, either as lessor or lessee, and otherwise functioning with respect to a transportation system in the metropolitan area and outside of such area, whether within or beyond the boundaries of this Commonwealth, to the extent necessary for the operation of an integrated transportation system....” (emphasis added)).