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decided: July 15, 1981.


Original jurisdiction in cases of Philadelphia Intermediate Unit 26 et al. v. Commonwealth of Pennsylvania, Department of Education et al.


John M. Elliott, with him Lawrence D. Berger and Gary R. Leadbetter, Dilworth, Paxson, Kalish and Levy, and Eugene F. Brazil and Robert T. Lear, for petitioners.

Lenora M. Smith, Assistant Counsel, with her John A. Alzamora, Assistant Counsel, and Mary Kay Kisthardt, Deputy Attorney General, for respondents.

President Judge Crumlish and Judges Rogers, Blatt, MacPhail and Palladino. Judges Mencer, Williams, Jr. and Craig did not participate. Opinion by Judge Blatt.

Author: Blatt

[ 60 Pa. Commw. Page 548]

This matter involves three consolidated petitions for review*fn1 filed by the Philadelphia County Intermediate Unit No. 26 and the School District of Philadelphia (petitioners) which challenge the refusal of the Department of Education (Department) and the other respondents*fn2 to approve the petitioners' budget for special education classes or to reimburse the petitioners for certain expenses incurred in providing such classes. Before us now are the respondents' preliminary objections to these petitions for review.

Section 1372 of the Public School Code of 1949 (Public School Code), Act of March 10, 1949, P.L. 30,

[ 60 Pa. Commw. Page 549]

    expense of training an exceptional child. See 24 P.S. § 25-2509. An intermediate unit, unlike a school district, has no taxing power; it must therefore be funded by the Commonwealth. Each school district is responsible, however, for the normal educational costs of exceptional children from that district, and so the school districts pay that portion of the intermediate unit expenses which would correspond to the costs of educating an equivalent number of normal students and the Commonwealth provides the additional funds needed by the intermediate units. As a bookkeeping practice, the Department offsets the total excess costs which it owes to the school districts against the amounts which the districts must contribute to the intermediate unit.

In 1974, the Department instituted an allocation system by which it established a fixed-dollar amount, representing the combined special education budgets of each intermediate unit and its member districts, and each year thereafter this allocation was increased by approximately seven percent; in the past, however, the Department has approved budgets that have exceeded those allocations. Previously, it fully paid the budgets of the intermediate units in the two payments in August and January and then it distributed the remainder of the allocation to the school districts, again in August/January installments. At the end of each school year, the Department customarily recouped the allocated but unexpended funds from the school districts which had such funds remaining and distributed that surplus to other districts which had exceeded their allocations.

The controversy now before us concerns a recent decision of the Department not to approve any combined special education budgets for the 1980-81 school year which exceeded the allocation for the intermediate unit concerned and its member school district. The

[ 60 Pa. Commw. Page 551]

    budgets submitted by the petitioners for the 1980-81 school year exceeded their allocation, and the Department informed them by letter of September 12, 1980, that their budgets would not be approved.

The petitioners filed three petitions for review challenging the Department's actions. In No. 2356, they contend that the Department improperly evaluated their budgets and that its disapproval thereof was not consistent with the Department's duty to determine whether or not the budgets were "reasonable and consistent with the intermediate unit plan for the operation of special education programs and services." 22 Pa. Code § 341.71(c). In No. 627, they claim that the Department wrongfully refused to reimburse them fully for special educational costs incurred in the years 1977-78 through 1979-80, although the Department did reimburse other intermediate units and school districts for the entire special education expenses of these units. In No. 512, the petitioners seek to compel the Department to repay them for the cost of transporting special education pupils under Section 2509.1 of the Public School Code, 24 P.S. § 25-2509.1.

The preliminary objections of the respondents now before us include challenges to the service, motions to strike, motions for more specific pleadings and demurrers.

The respondents contend first that this Court lacks personal jurisdiction over them because they received service through the mail rather than by hand delivery as required by Pa. R.C.P. No. 2104(b). These petitions for review were filed, however, under this Court's original jurisdiction and we believe that, according to Pa. R.A.P. 106, practice or procedure before us is controlled by the Rules of Appellate Procedure, where they are applicable. The form of service of petitions for review, therefore, is governed by Pa. R.A.P. 1514(c) which permits service by certified mail.

[ 60 Pa. Commw. Page 552]

The respondents next contend that the petitions for review in Nos. 2356 and 512 are based upon writings in the form of approved budgets, but that copies of those writings were not attached to the pleadings as required by Pa. R.C.P. No. 1019(h). The petitioners' claims are based, however, on what they contend to be the statutory duty of the respondents to review special education budgets in a prescribed manner and to reimburse the petitioners for the cost of providing special education. Their causes of action, therefore, are not based on writings and it was not necessary to attach copies of the approved budgets to the petitions for review. See Department of Transportation v. Bethlehem Steel Corp., 33 Pa. Commonwealth Ct. 1, 380 A.2d 1308 (1977).

The respondents have further asked for a more specific pleading in case No. 2356, claiming that certain allegations by the petitioners are so ambiguous that they fail to give notice to the respondents as to how to plead. Pa. R.C.P. No. 1017(b)(3). Yet, a pleading must be sufficiently specific to enable the respondent to prepare a defense. Commonwealth v. City of Jeannette, 9 Pa. Commonwealth Ct. 306, 305 A.2d 774 (1973). And, in the present case, the respondents would require the petitioners to aver inter alia what specific resources are available to fund special education, when and what funds were allocated to the petitioners, who made such allocations, what allegedly inequitable distributions were made and which intermediate units received those distributions. After examining these objections and the respondents' other requests for more specificity, we must conclude that the information which they seek either is of an evidentiary nature or is of such a character that the respondents' knowledge of the facts is equal, if not superior, to that of the petitioners and we therefore do not believe that a more specific pleading is necessary.

[ 60 Pa. Commw. Page 553]

    from the respondents for expenditures which were allegedly approved and therefore payable under 24 P.S. § 25-2509.1. Furthermore, any monies owed by the school district for transportation costs are to be paid to the Commonwealth under 24 P.S. § 25-2509.1, not directly to the intermediate units, and consequently the petitioners need not have joined the Philadelphia School District as an indispensable party.

Finally, the respondents have demurred in all three of these cases.

It is claimed that No. 2356 fails to state a cause of action in that it would require the respondents to review the petitioners' budgets which have already been disapproved as unreasonable because they exceed the available allocation. In Delaware County Intermediate Unit, No. 25 v. Department of Education, (No. 2103 C.D. 1980, filed April 2, 1981), however, it was held that the respondents have an obligation to review budgets previously approved for special education plans to determine whether or not they were reasonably consistent with those plans and that a determination that the budgets exceeded the allocations assigned by the Department of Education was insufficient to establish the unreasonableness of such budgets. The petitioners have alleged that their special educational plans were approved as of March 3, 1980, and, because we must accept well-pleaded facts as true for purposes of a demurrer, Burgerhoff v. Pennsylvania State Police, 49 Pa. Commonwealth Ct. 49, 410 A.2d 395 (1980), we believe that the reasoning of Delaware County Intermediate Unit, No. 25 v. Department of Education, supra, is equally applicable here so that we must overrule the demurrer to No. 2356. See also Central York School District v. Department of Education, 41 Pa. Commonwealth Ct. 383, 399 A.2d 167 (1979).

As to Nos. 627 and 512 the respondents argue that these cases fail to state claims in that (1) the determinations

[ 60 Pa. Commw. Page 555]

    for which review is sought are discretionary acts, not subject to mandamus, (2) the petitioners failed to allege exhaustion of their administrative remedies, and (3) the respondents have no obligation to reimburse the petitioners for the funds which are sought here. Although it is true that mandamus will not lie to compel a public official to perform a discretionary act, we may, when discretion has been exercised, review such an exercise to determine whether or not it was arbitrary or fraudulent or whether or not it was based upon an error of law. Garratt v. Philadelphia, 387 Pa. 442, 127 A.2d 738 (1956). In No. 627, the petitioners aver that the Department arbitrarily and fraudulently refused to reimburse them for special educational costs from prior years, and Sections 1373 and 2509 of the Public School Code, 24 P.S. §§ 13-1373 and 25-2509, impose a duty on the Department to make such reimbursement. We believe, therefore, that such a duty is enforceable through mandamus. See Central York School District v. Department of Education, supra. In No. 512, the petitioners specifically allege that the respondents approved their budgets for certain transportation costs and that pursuant to 24 P.S. § 25-2509.1, the respondents must reimburse the petitioners for a portion of the costs incurred. Again, we must take these well-pleaded facts as true, Burgerhoff v. Pennsylvania State Police, supra, and, because such facts would impose a non-discretionary duty to act on the respondents, we believe that mandamus will also lie here. Rose Tree Media School District v. Department of Public Instruction, 431 Pa. 233, 244 A.2d 754 (1968); Central York School District v. Department of Education, supra.

As to the respondents' objection that the petitioners have failed to allege exhaustion of available administrative remedies, we must point out that this issue was not raised in the respondents' brief nor was it

[ 60 Pa. Commw. Page 556]

    pursued at oral argument and we therefore find it unnecessary to address that question. Pa. R.A.P. 2116(a) requires that briefs must include a statement of the questions involved and it further provides that "[t]his rule is to be considered in the highest degree mandatory, admitting of no exception; ordinarily no point will be considered which is not set forth in the statement of questions involved or suggested thereby." We can discern no reason to disregard the provisions of this rule and we therefore will not consider these objections. See Kistler v. Unemployment Compensation Board of Review, 52 Pa. Commonwealth Ct. 465, 416 A.2d 594 (1980).

Finally, we must also reject the assertions of the respondents that they are not obligated to make the payments requested by the petitioners.

In No. 627, the petitioners seek reimbursements for special education costs which were fraudulently withheld and we find to be untenable the Department's claim that it is obligated to pay only those costs which were approved and for which funds are available. Pursuant to Section 2509 of the Public School Code, the Department must pay the lesser of the approved budget or actual excess costs and we cannot accept the implication inherent in the Department's argument that it may arbitrarily discriminate against some recipients of special education funds who had received their full allocation while providing additional funds to other similarly situated school districts and intermediate units. Furthermore, the unavailability of funds does not affect the petitioners' rights to reimbursement but would be most appropriately raised later in the respondents' answer or as a defense to a subsequent execution on a judgment. Reimbursement is also sought for monies advanced by the school district-petitioner to the intermediate unit-petitioner, and inasmuch as these funds might be characterized as excess

[ 60 Pa. Commw. Page 557]

    costs incurred by the school district to provide for special education, they may also be reimbursable under 24 P.S. § 25-2509. The existence of a separate contractual agreement between the Department and the school district, as the respondents seek to require, would not be necessary.

In No. 512, the Department asserts that it is not required to reimburse the petitioners for their total transportation costs. Again, however, any such contention does not defeat the petitioners' rights to payment, but would affect only the amount that the Department would owe and it should be raised as a defense in the respondents' answer.

We must, however, sustain the demurrer of the Auditor General to his joinder as a party. Although we found the Auditor General to be a necessary party in County of Allegheny v. Department of Public Welfare, 31 Pa. Commonwealth Ct. 379, 376 A.2d 290 (1977), the statute upon which that case was founded has since been amended and a warrant by the Auditor General prior to a disbursement of funds is no longer required. Act of April 9, 1929, P.L. 343, as amended, 72 P.S. §§ 1501 and 1502.

For the foregoing reasons, we will sustain the preliminary objection of the Auditor General and we will overrule those of the other respondents.*fn5


And Now, this 15th day of July, 1981, it is ordered that the preliminary objection of the respondent, the Auditor General of the Commonwealth, is sustained;

[ 60 Pa. Commw. Page 558]

And It Is Further Ordered that the preliminary objections of the other respondents are overruled and they are hereby directed to file their answer within fifteen (15) days of the filing of this opinion and order.


Preliminary objections of Auditor General sustained. All other preliminary objections overruled.

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