Opinion
No. 2052 C.D. 2014
07-08-2015
Pocono Mountain School District, Petitioner v. Pennsylvania Department of Education, Respondent
BEFORE: HONORABLE DAN PELLEGRINI, President Judge HONORABLE BERNARD L. McGINLEY, Judge (P.) HONORABLE P. KEVIN BROBSON, Judge
OPINION NOT REPORTED
MEMORANDUM OPINION BY PRESIDENT JUDGE PELLEGRINI
The Pocono Mountain School District (School District) petitions for review of the order of the Secretary of the Pennsylvania Department of Education (Department) granting the Department's motion to dismiss and dismissing the School District's appeal. For the reasons that follow, we affirm.
During the 2013-2014 school year, the Pocono Mountain Charter School (Charter School) operated under a charter approved by the School District. During this time, the Charter School failed to pay retirement contributions to the Public School Employees' Retirement System (PSERS). The School District ceased being the chartering school district for the Charter School as of June 21, 2014, which was the effective date for the Charter School's revocation of its charter. After the Charter School was closed at the end of the school year, the Department deducted $87,700.32 pursuant to Section 8327(b)(2) of the Public School Employees' Retirement Code (Code), 24 Pa. C.S. §8327(b)(2), from the basic education subsidy. The Department then deposited the amounts to the PSERS fund as required by the statute.
The School District appealed the deduction from its basic education subsidy. In response, the Department followed by filing a motion to dismiss the School District's administrative appeal, arguing that Section 8327(b)(2) of the Code required the Department to deduct the value from the School District's basic education subsidy and constituted a ministerial act which was not subject to review under the Administrative Code. The School District then filed a response opposing the Department's motion to dismiss, arguing that the Department's reduction in the School District's basic education subsidy constituted an adjudication subject to review. The School District also argued that discretion was exercised within the Department when someone incorrectly determined that the School District constituted a chartering school district at the time of the deduction, which it contended it was not on the date of the deduction.
The Secretary granted the Department's motion to dismiss, finding that the deduction constituted a ministerial action and was not the proper subject of an administrative hearing. The School District filed this petition for review.
Our scope of review is limited to determining whether a violation of constitutional rights has occurred, an error of law has been committed, or findings of fact are not supported by substantial evidence. School District of Philadelphia v. Department of Education, 547 A.2d 520, 522 (Pa. Cmwlth. 1988).
On appeal, the School District again contends that its due process rights were violated as the Department did not afford the School District notice and the opportunity to be heard before deducting the funds from its basic education subsidy. The School District argues that a hearing is necessary in order to determine which, if any, discretionary actions were taken by the Department in making the deduction.
Section 8327(b)(2) of the Code provides:
To facilitate the payments of amounts due from any charter school, as defined in Article XVII-A of the act of March 10, 1949 (P.L. 30, No. 14), known as the Public School Code of 1949, to the fund through the State Treasurer and to permit the exchange of credits between the State Treasurer and any employer, the Secretary of Education and the State Treasurer shall cause to be deducted and paid into the fund from any funds appropriated to the Department of Education for basic education of the chartering school district of a charter school and public school employees' retirement contributions amounts equal to the employer and pickup contributions which a charter school is required to pay to the fund, as certified by the board, and as remains unpaid on the date such appropriations would otherwise be paid to the chartering school district or charter school. Such amounts shall be credited to the appropriate accounts in the fund. Any reduction in payments to a chartering school district made pursuant to this section shall be
deducted from the amount due to the charter school district pursuant to the Public School Code of 1949.24 Pa. C.S. §8327(b)(2) (emphasis added).
The Department's duty, under Section 8327(b)(2), is ministerial, not discretionary. A "ministerial act" is defined as "one which a public officer is required to perform upon a given state of facts in a prescribed manner in obedience to the mandate of legal authority and without regard to his own judgment or opinion concerning the propriety or impropriety of the act to be performed." Council of Philadelphia v. Street, 856 A.2d 893, 896 (Pa. Cmwlth. 2004) (quoting Flaherty v. City of Pittsburgh, 515 A.2d 91, 92 (Pa. Cmwlth. 1986)). A ministerial act is "nonadjudicative and not subject to judicial review." Flinn v. Pittenger, 338 A.2d 735, 737 (Pa. Cmwlth. 1975).
Section 8327(b)(2) clearly identifies the steps that must be taken to ensure that the retirement contributions are paid into PSERS: Pursuant to the statutory provision, after the PSERS board has "certified" to the Department the amounts due to it as "unpaid" by the Charter School, the Department "shall" deduct the amount from the chartering school district - which, in this case, is the School District - and then deposit the amount into PSERS. Under Section 8327(b)(2) of the Code, the Department was then required to make the deduction after the PSERS' board certified the amounts due to it as unpaid by the Charter School. As the deduction in question was purely ministerial in nature, the Department did not make any discretionary, factual determinations in making the deduction. Because Section 8327(b)(2) does not allow any leeway for the Department to exercise its own discretion, and the Department abided by the statute, the Department was not required to hold a hearing before withholding the subsidies due the School District.
That the action is ministerial and not an adjudication remains true as long as it is undisputed that a school district is the proper entity from which funds are to be deducted and that amount is not in dispute. If either of those issues were in dispute, the resolution of those matters are an adjudication which normally would require a hearing under Section 504 of the Administrative Agency Law in proceedings in which factual issues are not in dispute. See Independence Blue Cross v. Pennsylvania Insurance Department, 802 A.2d 715, 720 (Pa. Cmwlth. 2002). In the absence of disputed facts, "the motion proceedings, including briefs and arguments by both parties, provide ample opportunity for the parties to be heard and the Administrative Agency Law requires no more." United Healthcare Benefits Trust v. Insurance Commissioner of Pennsylvania, 620 A.2d 81, 83 (Pa. Cmwlth. 1993). See Boyertown Area School District v. Department of Education, 797 A.2d 421, 427 (Pa. Cmwlth. 2002). Simply, hearings are not required where the dispute involves a pure question of law.
Section 504 provides that, "No adjudication of a Commonwealth agency shall be valid as to any party unless he shall have been afforded reasonable notice of a hearing and an opportunity to be heard. All testimony shall be stenographically recorded and a full and complete record shall be kept of the proceedings." 2 Pa. C.S. §504. --------
This brings us to the School District's next contention which presents a purely legal issue. It argues that the Secretary erred in finding that the School District was the Charter School's chartering school district when the deduction was taken. Specifically, the School District argues that the Department's determination that the School District was the Charter School's chartering school district was a discretionary act and disputes that Section 8327(b)(2) applies when, at the time of the deduction, the Charter School was no longer a charter school.
It is undisputed that during the 2013-2014 school year, the Charter School operated pursuant to a charter approved by the School District, rendering the School District the Charter School's chartering district. As such, the School District was the Charter School's chartering school district during the time period in which the Charter School incurred the obligation to make retirement contributions to PSERS. Nowhere in the language of Section 8327(b)(2) does it explicitly or implicitly indicate that a chartering school district is cleared from having to pay a deficient payment if the charter school ceases to operate as one. Rather, the only reference the statutory provision makes in regards to timing is that the deductions shall be made "from any funds appropriated to the Department ... for basic education of the chartering school district ... and public school employees' retirement contributions amounts ... as remains unpaid on the date such appropriations would otherwise be paid to the chartering school district ...." 24 Pa. C.S. §8327(b)(2). Although the deduction was taken after the Charter School's charter was revoked, the School District was the chartering school district during the period in which the deficiency arose and, thus, it is on the hook for the amount of the deficiency.
We understand that the Charter School Law allows only circumscribed review and oversight by the chartering school district of a charter school, normally only at renewal time; we also recognize that the chartering school district is not allowed to hold back funds to insure that the charter school and/or its for-profit management company pays what it owes to PSERS for pensions; we understand that the chartering district will be required to pay for missed pension payments even though other school districts send their pupils to this Charter School; and we also realize that the withholding of funds will have a deleterious impact on providing education to its own students. Regrettably, however, the Charter School Law plainly provides that the chartering school district is the entity that is obligated to pay PSERS' contributions if the charter school does not. Accordingly, we affirm the Secretary's order.
/s/_________
DAN PELLEGRINI, President Judge Judge Brobson concurs in the result only. ORDER
AND NOW, this 8th day of July, 2015, the Order of the Secretary of the Pennsylvania Department of Education dated October 23, 2014, at No. EDU-2014-SLAP-000176 is affirmed.
/s/_________
DAN PELLEGRINI, President Judge