Richard Allen Prep. Charter School v. PA, Department of Education and Pedro A. Rivera, in his official capacity as Secretary of Education
161 A.3d 415
| Pa. Commw. Ct. | 2017Background
- Richard Allen Preparatory Charter School submitted 2014–2015 end-of-year reconciliation claims totaling $103,085.72 to the PA Department of Education (Department) seeking withholding of the resident districts’ state subsidies under Section 1725‑A(a)(5) of the Charter School Law (CSL).
- Historically the Department (under the prior administration) permitted charter schools to perform end‑of‑year reconciliations and then withheld estimated amounts from delinquent districts’ subsequent state payments.
- On January 8, 2016 the Department issued a blanket notice saying, citing Chester II, it would cease processing end‑of‑year reconciliations and would only process withholding requests tied to the current school year; later it notified parties that there were no available 2014–2015 funds to withhold and that disputed claims would proceed to an administrative hearing.
- The Charter School filed suit seeking declaratory relief, mandamus, injunctive relief, and direct payment; it also filed an application for summary relief after the Department declined to withhold 2014–2015 funds and had not scheduled a hearing.
- The Court found no genuine dispute of material fact: the Charter School had submitted timely documentation soon after the school year ended and had relied on the Department’s prior practice; the Department had failed to follow the procedures the Chester II opinion required (acknowledge claim and notify charter school/district) and had not scheduled a hearing.
- The Court granted summary relief: it held Chester II did not control the facts here, ordered the Department to withhold and pay the amounts claimed from the districts’ state payments, awarded litigation costs, and directed the Department to pay attorney’s fees incurred after the complaint was filed.
Issues
| Issue | Plaintiff's Argument | Defendant's Argument | Held |
|---|---|---|---|
| Jurisdiction / availability of declaratory relief | Court has original jurisdiction because Department’s notice and failure to act left Charter School without a forum; an actual controversy exists and declaration will resolve imminent litigation | Department says Court lacks jurisdiction because administrative remedies (hearing/final order) were not exhausted; January 2016 Notice not a final order | Court exercised jurisdiction: Department’s actions left claimant without an administrative remedy, so declaratory relief appropriate |
| Application of Chester II (withholding limited to current‑year appropriations) | Chester II is distinguishable: claim was submitted weeks after year end under prior practice; Dept did not follow Chester II’s required procedures and retroactively changed policy | Dept contends Chester II limits withholding to available funds for the subject fiscal year and supports its refusal to withhold now | Court held Chester II does not control these facts; Dept failed to follow Chester II requirements and retroactive policy change was improper |
| Mandamus to compel withholding/payment | Charter School has clear legal right and no adequate remedy at law because Dept refused to withhold/pay and failed to schedule a hearing | Dept argues it need not pay until administrative hearing and cannot withhold absent available appropriations for that fiscal year | Court granted mandamus: Dept must deduct/withhold the amounts claimed from districts’ state payments and pay the Charter School accordingly |
| Injunctive relief and attorney’s fees/costs | Injunction necessary to prevent irreparable harm; Dept’s retroactive policy change was arbitrary and its delay dilatory/obdurate, justifying attorney’s fees under Section 2503 principles | Dept disputes obligation to pay and cites sovereign considerations and need for administrative process | Court granted mandatory injunctive relief, awarded costs and attorney’s fees (for post‑complaint dilatory/obdurate conduct) |
Key Cases Cited
- Waslow v. Pennsylvania Department of Education, 984 A.2d 575 (Pa. Cmwlth. 2009) (describing statutory duty of districts to pay charter schools)
- Chester Community Charter School v. Pennsylvania Department of Education, 44 A.3d 715 (Pa. Cmwlth. 2012) (Chester II) (holding withholding tied to appropriations for the school year and outlining required procedures when no funds are available)
- Chester Community Charter School v. Department of Education, 996 A.2d 68 (Pa. Cmwlth. 2010) (Chester I) (declaring Section 1725‑A remedies exclusive and mandating withholding duty)
- School District of Philadelphia v. Department of Education, 41 A.3d 222 (Pa. Cmwlth. 2012) (describing Department practice of withholding prior‑year delinquent amounts from next year’s Basic Education Subsidy)
- Mosaica Academy Charter School v. Department of Education, 813 A.2d 813 (Pa. 2002) (discussing availability of attorney’s fees in declaratory judgment context)