Designing Municipal Charges for Appellate Survival: What West Chester v. PASSHE Actually Teaches

On April 30, 2026, the Pennsylvania Supreme Court decided West Chester v. PASSHE, holding—in a fractured decision—that a borough’s “stormwater fee” was, in fact, a tax.  The case arose from West Chester’s attempt to fund its stormwater program by charging developed properties based on impervious surface area, including properties owned by a state university system that refused to pay.  The classification was decisive: because the charge was a tax, those state-affiliated entities were immune from paying it. 

Although the Court’s opinion spans pages discussing stormwater programs, its reasoning does not stop there.  The decision shows how courts—often quickly and based on the face of an ordinance—decide what a government charge really is.  And once the court answers that threshold question, the rest of the case can fall away. 

I. The Case Was Decided at the Threshold—and by the Ordinance’s Plain Language

In West Chester, the outcome turned on a single, threshold question: was the borough acting like a regulator carrying out a public duty, or like a provider charging for a service?  Once the Court answered that question against the borough, the rest of the case dropped out.  The charge was a tax.

That holding foreclosed the arguments municipalities often rely on—whether the charge was tied to use, whether it was fairly calculated, or whether the payor actually benefitted.  Those issues did not factor into the decision once the Court characterized the borough’s role as public and mandatory rather than contractual.

In reaching its conclusion, the Court focused on the plain language of the borough’s stormwater-program ordinance and the program’s structure.  The ordinance emphasized regulatory compliance and public health, describing a program carried out to meet legal obligations.  It applied broadly to “each and every” developed property, including those only indirectly benefited.  And it reflected no meaningful service relationship—no opt-in, no contract, just an obligation to pay.  Taken together, those features made the charge read as a community-wide imposition rather than a fee tied to use.

Those characterizations were drafting and structural choices—and by the time the case reached the Pennsylvania Supreme Court, they defined the case.

II. The Separate Opinions Show Where the Next Cases Will Be Won

The Court produced a narrow majority but not a unified approach.

The concurrence treated the issue as record-dependent.  It focused on how the borough used the revenue—highlighting projects remote from the university and directed to general community benefits—and treated those facts as decisive here.  But the concurrence did not treat the holding as categorical.  To the contrary, the concurrence signaled that a different program—one that directs funds more narrowly to stormwater remediation or ties charges more closely to property-specific benefits—might produce a different result.

The dissenters, by contrast, viewed the issues as requiring a different approach altogether.  In the dissenters’ views, stormwater systems are akin to utilities, such that the analysis should move past the threshold classification and address proportionality.  Against this backdrop, the dissenters opined that a charge can remain a fee even if it relies on imperfect measures—such as impervious surface—so long as those measures reasonably track use and the costs imposed.

Those opinions frame the next set of disputes.  Municipalities will emphasize how their programs allocate revenue and whether charges can be tied more directly to use.  Challengers will emphasize the breadth of the program, the general nature of the benefits, and the absence of any meaningful choice to participate.  The decisive issue will remain the same: how the program reads at the threshold.

III. Why the Work Cannot Wait Until Litigation

West Chester was resolved as a legal question, on a written record, with no opportunity to correct structural choices.

The Court relied on the ordinance text, the stated findings, and the structure of the program.  Once those features signaled a public-duty program without meaningful consent, the borough could not recover.

West Chester demonstrates that some disputes are decided as legal questions, often on a written record, with limited opportunity to fix structural problems later. 

Municipalities and authorities should be reassessing their programs now.  Many will face challenges from tax-immune entities seeking to extend West Chester.  Others will attempt to revise their funding models in light of the Court’s reasoning.  In either case, the critical work happens before litigation begins—when the charge is defined, the scope is set, and the program is described. 

By the time a complaint is filed, those choices are fixed.

IV. The Bottom Line

West Chester shows how quickly a funding mechanism can be reclassified on appeal—and how little room there is to recover once that happens.

For municipalities, the question is not just whether a program works from an engineering or policy standpoint.  It is whether, when reduced to a few pages on appeal, the program reads like a service people pay for or a public obligation they are required to support.

That issue is not litigated into existence—it is designed.  By the time a challenge is filed, the ordinance, the findings, and the structure of the program have already set the frame of the case.  What looks reasonable in practice can read as compulsory on paper.

That is why the work has to be done early.  In practical terms, that means pressure-testing the ordinance before adoption: how the charge is defined, how broadly it applies, what the revenue funds are, and whether the relationship to the payor looks contractual or mandatory. 

At the same time, West Chester makes clear that the analysis is not static.  For municipalities already facing challenges, the focus shifts to how the program is presented on the record and how the case is framed on appeal.  The Court’s divided opinions leave room for arguments about how closely charges track use, how revenue is deployed, and how the relationship between municipality and payor is understood.  Those issues can be sharpened—and, in some cases, reframed—through careful development of the record and focused appellate briefing.

Obermayer’s municipal and appellate teams work together on both ends.  That includes advising on ordinance design before disputes arise, and, where litigation is already underway, helping shape the record and arguments in a way that aligns with how courts have approached the tax-versus-fee question.

The advantage of early involvement is straightforward: it provides control over how the program will be read on appeal—rather than leaving that characterization to be fixed for the first time by a court.

Want to learn more? Stay tuned for an upcoming Obermayer program on this important topic.

The information contained in this publication should not be construed as legal advice, is not a substitute for legal counsel, and should not be relied on as such. For legal advice or answers to specific questions, please contact one of our attorneys.