Appeal from the Orders of the Commonwealth Court entered June 25, 2007, at Nos. 824 CD 2006 and 829 CD 2006 affirming the Orders of the Court of Common Pleas of Washington County entered March 28, 2006, at Nos. 2005-: 6319 and 2005-6322. 926 A.2d 1260 (Pa.Cmwlth. 2007) Nos. 3 and 4 WAP 2008. Appeal from the Orders of the Commonwealth Court entered June 25, 2007, at Nos. 825 CD 2006 and 826 CD 2006 affirming the Orders of the Court of Common Pleas of Washington County entered March 28, 2006, at Nos. 2005-: 6320 and 2005-6321. 926 A.2d 1260 (Pa.Cmwlth. 2007) Nos. 5 and 6 WAP 2008. Appeal from the Orders of the Commonwealth Court entered June 25, 2007, at Nos. 827 CD 2006 and 828 CD 2008 affirming the Orders of the Court of Common Pleas of Washington County entered March 28, 2006, at Nos. 2005-v. 926 A.2d 1260 (Pa.Cmwlth. 2007) 7906 and 2005-7907.
The opinion of the court was delivered by: Mr. Justice McCAFFERY
CASTILLE, C.J., SAYLOR, EAKIN, BAER, TODD, McCAFFERY, GREENSPAN, JJ.
ARGUED: September 8, 2008
The issue presented in the instant case is whether courts have subject matter jurisdiction over a challenge to a local authority's determination, pursuant to the Tax Increment Financing Act ("TIF Act"),*fn1 that an area is "blighted." In addition, we are asked to determine whether the instant allegations of bad faith on the part of the local authority are sufficient to withstand preliminary objections in the nature of a demurrer.
Appellants, who are two private individuals (Edward M. Mazur and Jeffrey W. Bull) and a citizens' group (Citizens Against Tax Incremental Financing), have challenged the use of tax increment financing ("TIF") for a commercial development project known as Victory Centre located in South Strabane Township ("the Township").*fn2 TIF is "a technique used by a municipality to finance commercial developments usually involving issuing bonds to finance land acquisition and other up-front costs, and then using the additional property taxes generated from the new development to service the debt." Ondek v. Allegheny County Council, 860 A.2d 644, 645 n.2 (Pa.Cmwlth. 2004) (quoting Black's Law Dictionary (8th ed. 2004)).
Pursuant to the terms of the Victory Centre TIF proposal, the total estimated cost of the project was $400 million, of which 93% was to be privately financed, and the remaining 7% was to be financed via the TIF mechanism, with a payback term of 20 years. The Victory Centre project included retail stores, restaurants, and a hotel on a mostly undeveloped site near the intersection of two interstate highways. Appellees, who are three local taxing entities (the Township, Washington County, and the Trinity Area School District) and the board members, commissioners, or supervisors thereof, each voted to participate in the TIF project. As required by statute, public hearings were held prior to the votes, and the Township determined that the site in question was a "blighted" area. See 53 P.S. §§ 6930.5(a)(5) and 6930.5(a)(6)(iv)(H). Also as required by statute, in October 2005, the Township, as the relevant municipal authority, enacted an ordinance to create the TIF district and to adopt the TIF project plan. See 53 P.S. § 6930.5(a)(6).
Appellants filed six suits against Appellees in the Washington County Court of Common Pleas. In three of the actions, Appellants appealed the decisions of the local taxing entities to adopt the TIF proposal; and in the other three actions, Appellants filed complaints in equity. In all six actions, Appellants sought the same form of relief, i.e., to set aside the taxing entities' decisions to approve and/or to participate in the TIF proposal. The grounds for all the actions were the same. Specifically, Appellants alleged that the decisions of the local governing entities with respect to the TIF plan for Victory Centre were wasteful of taxpayer dollars and that the determination of blight was factually incorrect; in addition, Appellants alleged that Appellees had acted in bad faith with respect to the determination of blight.*fn3
Appellees filed preliminary objections seeking to have all the actions dismissed for lack of subject matter jurisdiction or for failure to state a cause of action. The trial court consolidated all six actions, held that the court did not have subject matter jurisdiction, and accordingly sustained Appellees' preliminary objections; it then dismissed all the complaints.
Appellants appealed to the Commonwealth Court, which affirmed, concluding that, in essence, Appellants were challenging the merits and wisdom of legislative enactments, a matter over which the judiciary does not have jurisdiction. Mazur v. Trinity Area School District, 926 A.2d 1260, 1266-67 (Pa.Cmwlth. 2007) (en banc). More specifically, the Commonwealth Court cited Ondek, supra, for the proposition that a TIF resolution is a purely legislative enactment, not an adjudication, and accordingly the Local Agency Law, which allows aggrieved persons to appeal an agency adjudication, does not provide Appellants with a vehicle upon which to base their appeal.*fn4 Mazur, supra at 1265. In addition, the Commonwealth Court held that it did not have jurisdiction over Appellants' claims for equitable relief, citing the United States Supreme Court for the proposition that "[t]he judiciary may not sit as a super[-]legislature to judge the wisdom or desirability of legislative policy determinations made in areas that neither affect fundamental rights nor proceed along suspect lines." Id. at 1266 (quoting City of New Orleans v. Dukes, 427 U.S. 297, 303 (1976)). Concluding that Appellants' conclusory allegations were nothing more than an attack on the wisdom of the taxing districts' legislative enactments, the Commonwealth Court upheld the trial court's dismissal of all complaints based on lack of subject matter jurisdiction. Id. at 1268.*fn5
Appellants then filed a petition for allowance of appeal to this Court, which we granted, limited to the following two issues:
(1) Whether the Court has jurisdiction to review municipal decisions approving a TIF District supported by public funds?
(2) Whether [Appellants'] allegations that [Appellees] made findings of blight in bad faith are sufficient to withstand a demurrer?
Our standard and scope of review concerning questions of subject matter jurisdiction are well-established:
Jurisdiction over the subject matter is conferred solely by the Constitution and laws of the Commonwealth. The test for whether a court has subject matter jurisdiction inquires into the competency of the court to determine controversies of the general class to which the case presented for consideration belongs. Thus, as a pure question of law, the standard of review in determining whether a court has subject matter jurisdiction is de novo and the scope of review is plenary. Whether a court has subject matter jurisdiction over an action ...