Appeal from the order of the Court of Common Pleas of Montgomery County, Quarter Sessions Division, No. 7, 1970, in case of In re: Appeal of Michael Erdek, Richard Libson, et al. From an Ordinance of the Borough of Norristown Imposing a 1% Wage Tax.
Paul C. Vangrossi, for appellant.
Wallace A. Murray, Jr., with him Wisler, Pearlstine, Talone & Gerber, for appellee.
President Judge Bowman, and Judges Crumlish, Jr., Kramer, Wilkinson, Jr., Manderino, Mencer, and Rogers. Opinion by Judge Mencer.
In January of 1970, Norristown Borough Council adopted a budget for the 1970 calendar year. On May 19, 1970, the said council enacted a tax ordinance pursuant to the provisions of the Act of December 31, 1965, P.L. 1257, 53 P.S. §§ 6901-6924. This Act is known as "The Local Tax Enabling Act" and provided, in part: "Section 23. Repeals -- The Act of June 25, 1947 (P.L.
[ 1 Pa. Commw. Page 5791145]
) entitled, as amended . . . is repealed." This tax ordinance of May 19, 1970 imposed a one percent (1%) earned income tax upon all residents of, and all nonresidents employed in, the Borough of Norristown.
Certain nonresidents affected by the ordinance filed an appeal with the Court of Common Pleas of Montgomery County, challenging its validity. That court held a hearing, sustained the appeal and, by order dated November 4, 1970, declared the tax ordinance invalid and of no effect. The Borough of Norristown has appealed from the November 4, 1970 order, and its appeal must be sustained, and the order of the lower court declaring the ordinance in question invalid and of no effect must, therefore, be reversed.
In the lower court's opinion in support of its order, that court stated that from the testimony offered it was not convinced that those challenging the ordinance had overcome the strong presumption that, in exercising municipal powers, the municipal governing body had not abused its discretion but had acted with reason and good faith. See Bilbar Construction Company v. Easttown Township Board of Adjustment, 393 Pa. 62, 141 A.2d 851 (1958). Nevertheless, the lower court concluded that the ordinance was invalid. The one and only reason for reaching this conclusion was the belief that Rose Township v. Hollobaugh, 179 Pa. Superior Ct. 284, 116 A.2d 323 (1955) dictated such a conclusion.
In Rose Township it was held that the supervisors of a second class township did not have authority to levy a tax under the Act of June 25, 1947, P.L. 1145, as amended, 53 P.S. § 6851 et seq., for general purposes or for highway purposes, subsequent to the adoption of their budget in which the receipts from the tax were not contemplated; also, that the Act of June 25, 1947, as amended, was not intended to change the provisions relating to budgets.
The lower court's complete reliance on Rose Township overlooks the following two considerations. First: That case arose under The Second Class Township Code of May 1, 1933, P.L. 103, as amended and reenacted by the Act of July 10, 1947, P.L. 1481, and further amended in 1949, and dealt mainly with the budget requirements of Section 902, as then reported at 53 P.S. § 19093-902. Here we are considering the provisions of The Borough Code of 1966, Act of February 1, 1966, P.L. (1965) No. 581, 53 P.S. § 45101 et seq. The Rose Township case is not controlling authority for interpreting The Borough Code of 1966. Second: The tax ordinance in this case was enacted under "The Local Tax Enabling Act", supra, which specifically repealed the Act of June 25, 1947, P.L. 1145, as amended, which repealed act was interpreted by the Superior Court in the Rose Township case. We are not unmindful that Wilkes-Barre Appeal, 208 Pa. Superior Ct. 424, 222 A.2d 499 (1966), held that The Local Tax Enabling Act of 1965 constituted a substantial reenactment of the Act of June 25, 1947, P.L. 1145, as amended, so that the later statute should be construed to have continued the earlier statute in active operation without any ...