Appeal from the Order of the Court of Common Pleas of Delaware County, in the case of Commonwealth of Pennsylvania v. Thomas Talley, S.A. No. 559 of 1986.
Frank J. Marcone, for appellant.
Kyle A. Burch, for appellee.
Judges Craig and Barry, and Senior Judge Narick, sitting as a panel of three. Opinion by Senior Judge Narick.
[ 123 Pa. Commw. Page 314]
Thomas Talley (Appellant) seeks review of an order of the Court of Common Pleas of Delaware County denying his motion in arrest of judgment. For the reasons set forth below, we reverse.
Appellant is the owner and operator of an automotive repair shop in the Borough of Trainer (Borough). The Borough adopted an ordinance which imposed on individuals operating motor vehicle-related businesses a $100.00 yearly license fee.*fn1 Appellant was issued a citation by the Borough for failure to obtain this license and was subsequently found guilty before a District Justice of the Peace for the summary offense of failure to obtain a license. Appellant appealed and after a trial de novo was found guilty. Appellant thereafter filed a motion in arrest
[ 123 Pa. Commw. Page 315]
of judgment but his motion was denied. Appellant now appeals to this Court.
Appellant's argument before this Court as well as the trial court is that the ordinance is invalid because the amount of the license fee is not based upon the cost to the Borough for services provided to those made subject to the ordinance; and therefore, the license fee does nothing more than raise revenue for general governmental purposes.
A license fee has been defined by our Supreme Court in Mastrangelo v. Buckley, 433 Pa. 352, 385-86, 250 A.2d 447, 464 (1969):
A license fee is a sum assessed for the granting of a privilege. In most instances, where a license is granted the City invariably incurs expense such as the cost of registration and inspection; it is only proper that one who seeks and receives a license should bear this expense. To defray the cost of a license a fee is charged to the licensee; however, this fee must be commensurate with the expense incurred by the City in connection with the issuance and supervision of the license or privilege. (Footnote omitted.)
A license fee is distinguishable from a tax which is a revenue producing measure characterized by the production of a high proportion of income relative to the costs of collection and supervision. Greenacres Apartments, Inc. v. Bristol Township, 85 Pa. Commonwealth Ct. 572, 482 A.2d 1356 (1984). Thus, if a license fee collects more than an amount commensurate with the expense of administering the license, it would become a tax revenue ...