Appeals from the Orders of the Department of Community Affairs in the case of In Re: Annville-Cleona School District, $2,950,000 General Obligation Bonds, William B. Mellinger, Joerg W. P. Mayer, and Ruth C. Beachler v. Annville-Cleona School District, Lebanon County, Pennsylvania, Docket No. LGUDA-25; and in the case of In Re: Annville-Cleona School District, Dennis R. Marshall, et al., and Annville-Cleona Taxation Advisory Committee v. Annville-Cleona School District, Lebanon County, Pennsylvania, Docket No. LGUDA-27.
James A. Snell, for petitioners.
Henry G. Barr, with him, Richard B. Wood, Jens H. Damgaard, Rhoads & Sinon, for respondent, Annville-Cleona School District.
Judges Craig and MacPhail and Senior Judge Narick, sitting as a panel of three. Opinion by Judge MacPhail.
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The matter before us for disposition involves two petitions for review, consolidated for our consideration, from orders of the Department of Community Affairs (DCA). In the petition docketed at 963 C.D. 1986, William B. Mellinger, Joerg W. P. Mayer and Ruth C. Beachler challenge the DCA's dismissal of their complaint which had alleged that a $2,950,000 bond issue proposed by the Annville-Cleona School District (District) on February 10, 1986, was invalid. The petition docketed at 254 C.D. 1987 involves the DCA's dismissal of a similar challenge brought by Dennis R. Marshall and the Annville-Cleona Taxation Advisory Committee to a $4,900,000 bond issue proposed by the District on December 2, 1986. For the reasons which follow, we affirm the dismissal of both complaints.
[ 111 Pa. Commw. Page 379]
Two of the issues raised in these consolidated appeals are identical: (1) whether or not the DCA erred in dismissing Petitioners' complaints based on the District's motions to dismiss without first affording Petitioners an evidentiary hearing, and (2) whether the District was required to obtain the assent of the electorate prior to increasing its bonded indebtedness. In addition, Petitioners in the appeal docketed at 254 C.D. 1987 have raised the issue of whether DCA erred in approving as legal the purpose for which the District proposed to increase its indebtedness prior to final approval of the project by the Department of Education.
The gravamen of the complaints filed with the DCA is Petitioners' contention that the District has improperly sought approval from DCA of "electoral" debt without first gaining the approval of the electorate pursuant to Section 632 of the Public School Code of 1949 (Code), Act of March 10, 1949, P.L. 30, as amended, 24 P.S. § 6-632. Section 632 provides, pertinently, as follows:
The assent of the electors shall be required in all school districts of the second, third and fourth class, to issue bonds which will incur any new debt or increase the indebtedness to an amount in excess of five (5) per centum of the assessed valuation of property taxable for school purposes therein . . . . The board of school directors of any school district of the first, first class A, second, third, or fourth class shall have authority, without the assent of the electors, to issue bonds which will incur upon its own authority any amount of such indebtedness not in excess of five (5) per centum of the last assessed valuation of property taxable for school purposes therein.
As a factual matter, the District does not dispute that it is a fourth class district and that the increase in indebtedness
[ 111 Pa. Commw. Page 380]
proposed in each of the challenged bond issues in the matter at bar does exceed 5% of the assessed valuation of taxable property in the District. The District also acknowledges that it has now sought the ...