A portion of a 2011 Carbon County Court ruling that was appealed to Pennsylvania Commonwealth Court has been overturned.
The new ruling for the 2009 case involving former board of Carbon County Commissioners Wayne Nothstein, William O'Gurek and Charles Getz; the Carbon County Tax Claim Bureau; Panther Valley School District and Portnoff Law Associates of Norristown, was filed yesterday by Commonwealth Court Judge Mary Hannah Leavitt.
In her ruling Leavitt said the court "reversed the trial court's directive that delinquent tax payments must be made directly to the tax claim bureau and its determination that retroactive commissions are due and owning."
This refers to the portion of ruling by Monroe County Judge Jerome P. Cheslock, who oversaw the case in Carbon County, that states Panther Valley School District must pay Carbon County $223,000 in retroactive commission for delinquent tax collections from 2000 through 2011.
The new ruling states that Panther Valley, who employed Portnoff as the delinquent tax collector during that time period, will not have to pay the county from tax years 2000 through 2006.
However, Leavitt continues that the Commonwealth Court "affirms the trial court's order regarding the disclosure of records and the payment of commissions for tax year 2007 and forward."
Appellants Rosemary Porembo, superintendent of Panther Valley School District; and Michelle Portnoff, president of Portnoff Law Associates, both spoke out on the ruling.
"The lawsuit was a bully tactic to force the school district to use underperforming county services," said Portnoff during a phone interview Thursday afternoon. "The suit was without merit and squandered taxpayer dollars that could have been used for needed services."
"The district is very happy with the ruling because it ruled we do not owe the 5 percent commission on the taxes collected from 2000 to 2006," Porembo said Friday morning, adding that the ruling also confirmed that the school district had the right to collect delinquent taxes or have a third party collect the taxes rather than having to go through the county.
She noted that the second portion of the Commonwealth Court's ruling, which affirms payment, has already been in the works.
Panther Valley School District has been paying the county the commission from all delinquent taxes collected from 2007 forward, Porembo explained.
Carbon County Commissioner Wayne Nothstein, chairman, also commented on the ruling on behalf of the county.
He said that the board is waiting to hear back from their attorney, Jane Maughan of Stroudsburg, and see how she interprets the ruling because, right now, the commissioners have questions.
"It talks about the hardships of the school district," Nothstein said on Friday, "but what about the hardship to the county for the lost revenue? I'm disappointed with the ruling."
He noted that one area the new ruling did not address was the thousands of dollars the county spent on hiring firms to complete audits to try and assess the overall accuracy of Portnoff's information on delinquent tax collections; as well as other expenses associated with the case. Carbon spent close to $100,000 in audits and other items that were deemed necessary for the resolution of the problem.
In the Carbon County court case, Cheslock ruled that Panther Valley was expected to cover the costs the county incurred as a result.
Carbon County filed a complaint and notice of mandamus against Panther Valley School District on Nov. 13, 2009, in the hopes of revising the way the school district was collecting delinquent real estate taxes.
The suit was based on an earlier ruling in a Monroe County lawsuit filed against the East Stroudsburg School District in 2006. In that case the court ruled that tax records and returns are to be filed with the county tax claim bureau.
The complaint, which named Panther Valley School District; Porembo, and school board members Ronald Slivka, Anthony Pondish, Anthony DeMarco, David Hiles, Thomas Shober, William Hunsicker, Jeff Markovich, Donna Trimmel and R. Mickey Angst, sought to have delinquent tax records that were collected by Portnoff, who was hired by the school district, returned to the county so that the county could have complete records of all property liens and delinquencies.
The county also sought to receive 5 percent commission, or nearly $300,000 from the school district, which, according to the suit, the tax claim bureau was entitled to under the Pennsylvania Real Estate Tax Sale Law.
In October 2011, Judge Cheslock ruled in favor of Carbon County, stating that the district must turn over all tax records from 2000 through 2011; and pay the 5 percent commission and other fees, including costs incurred in the suit, and legal fees.
Shortly after, Panther Valley and Portnoff filed the appeal to Commonwealth Court, stating that county court "erred in ordering retroactive commissions for tax years 2000 through 2006 because that order violates the statute of limitations and doctrine of laches ... erred in ordering that all delinquent tax payments collected by the school district must be paid to the tax claim bureau for distribution to the school district."
The appeal also stated that the county "did not have a right to peremptory judgment under the time-honored principles relating thereto" and the "trial court erred in awarding costs and attorney fees to the county."