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City of Scranton says it properly charged Lackawanna County over $200K for building renovation costs

PENNSYLVANIA RECORD

Sunday, December 22, 2024

City of Scranton says it properly charged Lackawanna County over $200K for building renovation costs

State Court
Josephaobrien

O'Brien | Oliver Price & Rhodes

SCRANTON – The City of Scranton has refuted Lackawanna County’s lawsuit attempting to secure more than $200,000 in building permit fees it paid in connection with an administrative building renovation, arguing that the amount was in accordance with the actual costs associated with the project.

The County first filed suit in the Lackawanna County Court of Common Pleas on March 3 versus the City. Both parties are of Scranton.

According to the County, it renovated the former Globe store located in downtown Scranton for use as an administrative building. The City assessed two fees related to the building permit for the project, for a total of $208,157.04: 1) A lump sum building permit fee in the amount of $107,815.50 and 2) A fee of $100,341.54 for third-party inspections. In accordance with City Ordinance Section 187-7, the fees assessed were calculated on the basis of construction cost.

“The fees were not commensurate with, and were grossly disproportionate to, the City’s actual cost in administering the building permits and inspections. The City collected the fees to raise revenue, rather than to defray the City’s costs in administering the building inspections and permits,” the suit stated.

“To avoid a delay in commencement of construction, the County paid the fees to the City, and expressly reserved the County’s rights to seek a refund of all amounts deemed excessive, unreasonable and contrary to Pennsylvania law.”

The fees were paid by checks issued by Quandel Construction Group, Inc. The County reimbursed Quandel for the checks and the City admitted in an email exchange that the fees were at least in part intended to add to the City’s general revenues, according to the lawsuit.

“The City is not legally entitled to the fees collected from the County. The County requested the City to refund the fees. On Dec. 9, 2020, the County submitted a written and verified claim, under 72 P.S. Section 5566(b), for the refund of fees. The City has not provided a written response to the claim, but has verbally refused to refund the fees,” per the suit.

“The action is brought in accordance with 72 P.S. Section 5566(c), which requires that ‘in the event of refusal or failure on the part of authorities of the political subdivision involved to make any such refund of taxes, license fees, penalties, fines or other moneys to which the political subdivision is not legally entitled…then the aggrieved person or corporation shall have the right to bring suit…by instituting an action in assumpsit in the Court of Common Pleas of the county wherein such political subdivision is located.”

UPDATE

The City filed an answer to the complaint along with new matter on May 17, denying the majority of the County’s claims.

“The fees were not commensurate with and were not grossly disproportionate to, the City’s actual cost in administering the building permits and inspections and were otherwise authorized by law,” the answer stated.

“Defendant lacks knowledge or information sufficient to form a belief as to the allegations of [the given] paragraphs and demands strict proof thereof at the trial of this matter. The allegations of [the other] paragraphs constitute conclusions of law and are therefore deemed denied.”

In new matter, the City argued that the County had failed to state a claim upon which relief could be granted.

On May 24, Lackawanna County’s attorneys replied to the lone new matter charge with a blanket denial, characterizing it as a conclusion of law to which no official response is required.

For a count of assumpsit, the plaintiff is seeking damages of $208,157.04, plus interest, costs, attorney’s fees and such other relief as this Court deems proper.

The plaintiff is represented by William W. Warren Jr. and Sunu M. Pillai of Saul Ewing Arnstein & Lehr, in Pittsburgh.

The defendant is represented by Joseph A. O’Brien of the City of Scranton’s Law Department, in Scranton.

Lackawanna County Court of Common Pleas case 2021-CV-01014

From the Pennsylvania Record: Reach Courts Reporter Nicholas Malfitano at nick.malfitano@therecordinc.com

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