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ALLEGHENY AIRLINES v. PHILADELPHIA (09/05/73)

SUPREME COURT OF PENNSYLVANIA


decided: September 5, 1973.

ALLEGHENY AIRLINES, INC. ET AL., APPELLANTS,
v.
PHILADELPHIA

Appeal from order of Commonwealth Court, No. 830, C.D. 1972, dismissing decree of Court of Common Pleas, Trial Division, of Philadelphia, June T., 1972, No. 3604, in case of Allegheny Airlines, Inc. et al. v. City of Philadelphia.

COUNSEL

Bernard J. Smolens, with him Ralph S. Snyder, Schnader, Harrison, Segal & Lewis, Cleary, Gottlieb, Steen & Hamilton, Pepper, Hamilton & Scheetz, and Dechert, Price & Rhoads, for appellants.

Pace Reich, Deputy City Solicitor, and John M. McNally, Jr., First Deputy City Solicitor, with them Martin Weinberg, City Solicitor, for appellee.

Jones, C. J., Eagen, O'Brien, Roberts, Pomeroy, Nix and Manderino, JJ. Opinion by Justice Roberts. Mr. Justice Nix concurs in the result.

Author: Roberts

[ 453 Pa. Page 183]

Appellants, Allegheny Airlines et al., instituted a suit in equity against the City of Philadelphia in the Philadelphia Court of Common Pleas attacking the validity of Bill No. 207, an ordinance amending Section 18-200 of the Philadelphia Code, enacted May 31, 1972. In this suit appellants sought a temporary injunction restraining enforcement of this ordinance. In pertinent part Bill No. 207 established:

"(a) a head tax of $2.00 upon some (but not all) passengers arriving at or departing from appellee's (the City's) airports; and

"(b) a duty upon appellants to collect the tax and, apart from the amount actually collected, to pay to appellee the amount 'that should have been collected.'"

On July 21, 1972, the court of common pleas entered a decree sustaining the validity of that portion of Bill No. 207 imposing a departure tax upon passengers at Philadelphia airports, but declaring unconstitutional as an impermissible burden on interstate commerce that portion of the Bill imposing an arrival tax on all passengers. Subsequently, on August 3, 1972, the City of Philadelphia enacted Bill No. 287 amending Section 18-204 of the Philadelphia Code. So far as material to this dispute, Bill No. 287:

"(a) imposed upon some (but not all) passengers departing from Philadelphia airports a head tax of $3.00; excluded from the tax are military personnel and continuous flight passengers who remain in Philadelphia not more than 6 hours;

"(b) imposed upon appellants the duty to collect the tax and, apart from the amounts actually collected, to pay to Philadelphia the amount 'that should have been collected';

"(c) required that the tax be added to the price of the ticket and collected at the same time as payment is made for the ticket."

[ 453 Pa. Page 184]

Appellants appealed the common pleas court's decree to the Commonwealth Court, contesting the validity of both Bill No. 207 and the subsequent Bill No. 287.*fn1 The Commonwealth Court, reasoning that to determine the validity of Bill No. 287 would be improper, since that Bill was not litigated below, and that it did not possess "original jurisdiction to determine the enforceability of local ordinances," dismissed the appeal without prejudice to appellants to institute an appropriate action contesting the validity of Bill No. 287. Pursuant to appellants' timely petition, we assumed plenary jurisdiction to determine the validity of both challenged ordinances (Bills No. 207 and 287). We now reverse the decree of the Court of Common Pleas of Philadelphia.

Appellants advance four principal arguments in support of their contention that the tax ordinance(s)

[ 453 Pa. Page 185]

    are invalid.*fn2 However, in view of recent federal legislation and our disposition here, we need not concern ourselves with appellants' contentions.

In a recent amendment to Title XI of the Federal Aviation Act of August 23, 1958, 49 U.S.C. §§ 1301 et seq. (1970), Congress added the following new section:

"State Taxation of Air Commerce

"Sec. 1113. (a) No State (or political subdivision thereof, including the Commonwealth of Puerto Rico,

[ 453 Pa. Page 186]

    the Virgin Islands, Guam, the District of Columbia, the territories or possessions of the United States or political agencies of two or more States) shall levy or collect a tax, fee, head charge, or other charge, directly or indirectly, on persons traveling in air commerce or on the carriage of persons traveling in air commerce or on the sale of air transportation or on the gross receipts derived therefrom: Except, That any State (or political subdivision thereof, including the Commonwealth of Puerto Rico, the Virgin Islands, Guam, the District of Columbia, the territories or possessions of the United States or political agencies of two or more States) which levied a tax, fee, head charge, or other charge, directly or indirectly, on persons traveling in air commerce or on the carriage of persons traveling in air commerce or on the sale of air transportation or on the gross receipts derived therefrom prior to May 21, 1970, shall be exempt from the provisions of this subsection until December 31, 1973." Pub. L. 93-44, Title XI, § 1113(a), June 18, 1973, 87 Stat. 90.

This legislation, enacted pursuant to Congress's constitutional authority to regulate interstate commerce, has undeniably preempted any state, or local, intervention in the field of airport head taxes. See Bessemer & L.E.R. Co. v. Pennsylvania P.U.C., 430 Pa. 339, 243 A.2d 358, cert. denied, 393 U.S. 959, 89 S. Ct. 403 (1968). The Act renders constitutionally invalid and impermissible existing state or local airport head taxes. The Federal Government, having exercised its express constitutional authority over interstate commerce, that field is not available for state or local action. Here, as in Bessemer, supra, state intrusion is precluded.

Moreover, since the challenged Philadelphia tax ordinances, here, were enacted on May 31, 1972, and August 3, 1972 -- not prior to May 21, 1970 -- these ordinances are not exempt from the provisions of the Act. Therefore, in view of this Congressional mandate prohibiting

[ 453 Pa. Page 187]

"a tax, fee or head charge . . . on persons traveling in air commerce . . ." there can be no doubt whatsoever that both tax ordinances amending Sections 18-200 and 18-204 of the Philadelphia Code (Bill No. 207 and Bill No. 287) are constitutionally impermissible and invalid, and must be stricken.

The decree of the Court of Common Pleas of Philadelphia is reversed.

Each party to pay own costs.

Disposition

Decree reversed.


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