Appeals from order of Court of Quarter Sessions of Luzerne County, Nos. 232 and 245 of 1966, in re appeal from 1966 earned income tax ordinance of City of Wilkes-Barre; and appeal of taxpayers from Ordinance No. 2 of City of Wilkes-Barre.
James W. McNulty, with him Thomas J. Foley, George L. Fenner, Jr., City Solicitor, and Rosser, McDonald, Marcus & Foley, for City, appellant.
Bernard J. Hendrzak, with him James Lenahan Brown, for appellees.
Arthur Silverblatt, with him Howard A. Berman and Samuel Nelson, for appellees.
Ervin, P. J., Wright, Watkins, Montgomery, Jacobs, Hoffman, and Spaulding, JJ. Opinion by Hoffman, J. Dissenting Opinion by Wright, J.
[ 208 Pa. Super. Page 426]
This is an appeal from an order of the Court of Quarter Sessions of Luzerne County declaring invalid an earned income tax ordinance of the City of Wilkes-Barre on the grounds that:
(1) the ordinance was adopted on January 10, 1966, under the Act of June 25, 1947, P. L. 1145, as amended, 53 P.S. § 6851 et seq., which was specifically repealed by the General Assembly on January 1, 1966; and
[ 208 Pa. Super. Page 427]
(2) the ordinance was not properly advertised in accordance with law.
Was the ordinance invalid because enacted under a repealed statute?
On December 7, 1965, the City Clerk of Wilkes-Barre was directed by the City Council to advertise the City's intention to impose an income tax. The ordinance was to be enacted under the authority of the Act of June 25, 1947 (P. L. 1145), as amended. On December 8, 15, and 22, 1965, such notice was advertised in the Wilkes-Barre Record.
On Friday, December 31, 1965, Governor Scranton signed into law Act No. 511 known as "The Local Tax Enabling Act," 53 P.S. §§ 6901-6924, effective January 1, 1966. This act provided in part: "Section 23. Repeals -- The Act of June 25, 1947 (P. L. 1145), entitled, as amended . . . is repealed."
On Tuesday, January 4, 1966, at a regular meeting, the Council passed the proposed tax ordinance on first reading. On January 10, 1966, the Council met again and enacted the ordinance after a second and third reading. The ordinance reads in part: "Be It Ordained And Enacted By The Council Of The City Of Wilkes-Barre under the authority of the Act of June 25, 1947, (P. L. 1145) And Its Amendments, as follows. . . ."
A municipality has no original power of taxation; a municipal tax ordinance must be authorized by an act of the General Assembly. Should there be a repeal of such an act, the power to tax would also be withdrawn. Allentown School District Mercantile Tax Case, 370 Pa. 161, 87 A.2d 480 (1952); Marson v. Philadelphia, 342 Pa. 369, 21 A.2d 228 (1941). On its face, therefore, the ordinance would appear invalid,
[ 208 Pa. Super. Page 428]
since it was purportedly enacted under the authority of a repealed act.
Before examining this major problem, however, we must consider the significance of the City's failure to comply with the requirement of the 1965 Local Tax Enabling Act which provides: "Each ordinance . . . shall state that it is enacted under the authority of this act, known as 'The Local Tax Enabling Act.'" (§ 5).
The importance of such a direction was considered in Pleasant Hills Borough v. Carroll, 182 Pa. Superior Ct. 102, 125 A.2d 466 (1956). In that case, a taxpayer contended that the Borough wage tax ordinance was invalid because the ordinance did not contain a statement that it was enacted under the authority of the 1947 taxing act, as required by statute. We held that the requirement of a statement of legislative authority in the ordinance was only directory and not mandatory. We stated further that: "To hold that a provision is directory rather than mandatory, does not mean that it is optional -- to be ignored at will. Both mandatory and directory provisions of the legislature are meant to be followed. It is only in the effect of non-compliance that a distinction arises. A provision is mandatory when failure to follow it renders the proceedings to which it relates illegal and void; it is directory when the failure to follow it does not invalidate the proceedings."*fn1 (pp. 106-7)
In the instant case, the City not only failed to recite the proper legislative authority for its actions but, also, referred to a statute which had been repealed.
[ 208 Pa. Super. Page 429]
This additional error need not prove fatal, however, for it is likewise a general statement of law that a misrecital in an ordinance of the source of power by which the ordinance is passed does not invalidate it if in point of fact the power to enact it existed. City of Waco v. McCraw, 127 Tex. 268, 93 S.W. 2d 717 (1936); Ralston Purina Company v. Acrey, 220 Ga. 788, 142 S.E. 2d 66 (1965); Missouri-Kansas-Texas Railroad Company v. Maltsberger, 189 Okl. 363, 116 P. 2d 977 (1941); Baltimore v. Ulman, 79 Md. 469, 30 A. 43 (1894); State v. Clark, 88 Idaho 365, 399 P. 2d 955 (1965); 5 McQuillin, Municipal Corporations, § 16.14, p. 183 (3d ed. 1949); 62 C.J.S. p. 791.
Thus, the improper reference to the Act of 1947 rather than the Act of 1965 does not invalidate the ordinance so long as the City in fact had the power to enact it in 1966.*fn2 Neither party disputes that the City had such power. The significant question in this case, therefore, is whether enactment proceedings, which were initiated by the City in 1965, could be continued and concluded in 1966, even though the Legislature, in the interim, had repealed the 1947 act and simultaneously enacted the 1965 act.
In considering this question special note must be taken of § 82 of the Statutory Construction Act of May 28, 1937, P. L. 1019, 46 P.S. § 582, which provides: "Whenever a law is repealed and its provisions are at
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the same time re-enacted in the same or substantially the same terms by the repealing law, the earlier law shall be construed as continued in active operation, and a reference to the earlier law in any other law shall be construed as a reference to the repealing law. All rights and liabilities incurred under such ...