Statutory Construction: In Pari Materia; Application of Expressio Unius Est Exclusio Alterius

Schock v. City of Lebanon, 167 A.3d 861 (Pa. Cmwlth. 2017), allocatur granted Dec. 27, 2017, appeal docket 79 MAP 2017


Edward J. Schock appealed to Commonwealth Court from an order of the Court of Common Pleas of Lebanon County granting the City of Lebanon’s motion for summary judgment and dismissing Schock’s declaratory judgment action. Schock sought a determination that the 40 percent objection threshold for a veto of the City’s final plan for a neighborhood improvement district (NID) was reached when 132 of the 280 assessed properties formally registered objections to the final plan. The specific question presented by Schock’s appeal was whether, in interpreting Section 5(f)(2) of the Neighborhood Improvement District Act, Act of December 20, 2000, P.L. 949, as amended, 73 P.S. §835(f)(2),the term “affected property owners” should be construed to include the smaller group of only those property owners assessed under the proposed NID, or whether the term should include the larger set of all property owners located within the physical boundaries of the NID who will be affected by it. The Lebanon County Court (Judge Charles) held that the term “affected property owners” included the larger set of all property owners within the physical boundaries of the NID who will be affected by it. Commonwealth Court affirmed in an opinion authored by Judge Simpson for a panel including Judge Covey and Senior Judge Leadbetter.


Commonwealth Court outlined the facts found by the Lebanon County Court as follows:

In 2010, the City of Lebanon began contemplating a business improvement district (BID), a type of NID, for its downtown. A feasibility study recommended the appointment of a BID steering committee and the hiring of a consultant to develop a BID plan. In 2014, following a study including interviews with residents and business owners, the City published a 69-page economic development action plan designed to promote growth through 2020. The plan outlined the City’s current status and the challenges it faced. The plan also set forth numerous proposals for meeting those challenges. In addition, the BID steering committee continued to develop plans for a BID.

In September 2015, the City sent a letter to all property owners and lessees located in the proposed BID. All recipients were invited to a public meeting on November 4, 2015. A court reporter attended the meeting and transcribed the proceedings. Many residents provided comments both for and against the proposed BID.

A November 20, 2015 letter to all BID residents announced City Council’s acceptance of the preliminary plan for the BID. The letter advised that the preliminary plan is now considered the BID final plan. The letter further communicated how BID residents could vote upon the establishment of the BID. Nothing needed to be done to register a “yes” vote.

However, to register a “no” vote, those opposing the creation of the BID had to submit written objections to the final plan to the City Clerk within 45 days. All objections would have to include the property address, the Lebanon County Tax Assessment Identification Number, and a notarized signature of all owners listed on the deed to the property. The letter also stressed that a negative vote of 40% of property owners would be needed to defeat the final plan for the BID.

Appendix B of the final BID plan included a list of 358 properties located in the BID. Of that number, 78 properties were deemed exempt from BID assessment. Both parties agreed that the City received 146 objections from property owners subject to assessment under the plan. However, the City rejected 13 of the objections, thereby counting only 132 objections. Only one assessment exempt property owner filed an objection; he also owned three assessed properties. In evaluating the 40% threshold for a veto of the final plan, the City considered not just the 280 properties subject to assessment, but also the 78 exempt properties. Therefore, the City determined that 132 of the 358 total affected properties objected. As the City interpreted Section 5(f)(2) of the Act, only 36.8% of the total 358 affected property owners objected. Thus, the 40% veto threshold was not reached.

Slip op. at 2-4.

Following discovery, the parties filed cross-motions for summary judgment. The court granted the City’s motion and dismissed Schock’s complaint, stating its rationale as follows:

Sifting through the above, no material issue of fact exists on the issue of whether the BID actually would ‘affect’ exempt properties. Clearly, the evidence and affidavits submitted by the [City] reveal that improvements such as upgraded lighting and enhanced security will benefit all property owners regardless of whether those owners are assessed a fee or not. While [Objector] has attempted to convince us that only those with a financial stake should have a voice, next to nothing has been presented by [Objector] to refute that the BID has and will continue to ‘touch,’ ‘impact’ and ‘influence’ non-assessed BID property owners. As to whether exempt property owners would be ‘affected’ by the BID, the answer is clearly ‘yes.’

Having concluded that all property owners within the designated district will be ‘affected’ by the BID, logic dictates that all such property owners must be included within the census used to evaluate whether the 40% objection threshold has been met. In this case, both parties agree that 132 objections is not enough to defeat the BID if the total number of properties within the physical confines of the BID are counted. Because we hold today that all such properties are ‘affected’ by the BID, we must also therefore conclude that the 132 objections lodged to the BID are insufficient to defeat it. Hence, we are constrained to grant the [City’s] Motion for Summary Judgment and dismiss [Objector’s] declaratory judgment action.

Slip op. at 11 (emphasis omitted) (citing the county court’s opinion at 21-22). Schock appealed.

Before Commonwealth Court, Schock argued that the county court erroneously construed the term “affected property owners” to include all properties located within the physical boundaries of the NID rather than only those properties assessed under the proposed final plan. As Judge Simpson noted, Schock repeated the arguments he made below, summarizing the jist as “[e]ssentially, [Schock] asserts that only those who pay should have a say in voting on the final plan under Section 5(f)(2) of the Act.”  Slip Op. at 12.

In a lengthy discussion, Commonwealth Court agreed with the county court that the primary issue was who constitutes an “affected property owner” for purposes of vetoing a final plan under Section 5(f)(2) of the Act. The court discussed: the applicable principles of statutory construction (Slip op. at 16-17); the relevant provisions of the Act (Slip op. at 17-22); the proper construction of those provisions (Slip op. at 22-26); reading those provisions in pari materia (Slip op. at 26-27); the application of expressio unius est exclusio alterius (the express mention of a specific matter in a statute implies the exclusion of other not mentioned) (Slip op. at 27-28); and, other municipal ordinances establishing NIDs including Philadelphia’s (Slip op. at 28-29).

Finding that Schock’s arguments on each of those aspects of the county court’s opinion were unavailing, Commonwealth Court affirmed the county court’s order granting judgment to the City and dismissing Schoch’s complaint.

The Supreme Court granted allocatur on the following issue, as stated by Schock:

Where subsection 5(f)(2) of the Neighborhood Improvement District Act, Act of December 20, 2000, P.L. 949, No. 130 provides for veto of a final plan “[i]f 40% or more of the affected property owners within the proposed NID [neighborhood improvement district] register their disapproval,” is the term “affected property owners within the proposed NID” limited to the owners of properties to be assessed under the plan or does the term include the owners of all properties that are within the physical boundaries of the district?

For more information, contact Kevin McKeon or Dennis Whitaker.