In Re Incorporation of New Morgan
527 Pa. 226, 1991 Pa. LEXIS 95, 590 A.2d 274 (1991)
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Rule of Law:
A petition for the incorporation of a borough may be granted even if a sole landowner's motivation is partly to develop land free from existing township zoning regulations, provided the proposed borough constitutes a 'harmonious whole' with common interests and problems, and the disadvantages to existing governmental units do not presently outweigh the advantages of incorporation.
Facts:
- Morgantown Properties, a limited partnership, owned a 3,700-acre tract of land in Berks County, Pennsylvania.
- This tract of land was located partly in Caernarvon Township and partly in Robeson Township.
- Only six occupied homes existed within the proposed borough area at the time of the petition.
- Morgantown Properties proposed to develop the land with a landfill, a trash-to-steam plant, a 'Victorian Village' tourist attraction, a golf course, a cultural center, commercial areas, agricultural areas, and open spaces.
- Morgantown Properties filed a petition to incorporate this entire tract as the Borough of New Morgan.
Procedural Posture:
- Morgantown Properties filed a petition to incorporate a borough with the Court of Common Pleas of Berks County.
- The Court of Common Pleas established a Borough Advisory Committee, which, after conducting over 100 hours of hearings, voted three to two in favor of incorporation.
- The Court of Common Pleas adopted the findings of fact and conclusions of law of the majority report and entered a final decree granting the petition for incorporation.
- Caernarvon Township, Robeson Township, Kathleen Hood et al., and Harry J. Smith et al. (appellants) appealed the trial court's order to the Commonwealth Court.
- A panel of the Commonwealth Court affirmed the trial court's decision, with one judge dissenting.
- The appellants petitioned for allowance of appeal to the Supreme Court of Pennsylvania, which granted allocatur.
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Issue:
Does a trial court abuse its discretion in granting a petition for borough incorporation when a sole landowner's motivation is partly to avoid existing township zoning regulations, and the proposed borough combines potentially discordant elements like a landfill and a tourist attraction, potentially causing future disadvantages to the surrounding townships?
Opinions:
Majority - Justice Flaherty
No, a trial court does not abuse its discretion in granting a petition for borough incorporation under these circumstances. The court found that inquiry into an applicant's motive for incorporation is generally inappropriate unless racial discrimination is at issue, as the legislature has been silent on the matter. Even if avoiding land use regulations were considered an improper motive, the evidence did not show this was Morgantown's sole motivation; instead, it was driven by a desire to establish an independent governmental agency to complement its conceptual development theme. The proposed borough, despite combining a landfill with a tourist attraction, was deemed a 'harmonious whole' by the trial court and advisory committee. The court reasoned that the diverse land uses required a coordinated governmental effort to manage projected traffic and population increases, which differed significantly from the rural townships. Finally, the present financial disadvantages to the townships were minor compared to the advantages of incorporation, and potential future disadvantages (like loss of future tax revenue or increased road maintenance) were not sufficient to overturn the incorporation, especially since statutory mechanisms exist for inter-municipal cooperation for transportation needs.
Dissenting - Justice McDermott
Yes, the trial court did abuse its discretion, and the incorporation should not be permitted under these circumstances. Justice McDermott dissented on two main grounds. First, he argued that the issue of bias in the Borough Advisory Committee should have been remanded for inquiry, particularly concerning two members who were tenants and one an employee of Morgantown Properties, and who had indicated their favor for incorporation prior to the close of hearings. He believed a 'fixed position of an employee of an applicant ought not be countenanced.' Second, he disagreed with the majority's narrow view of 'improper motive,' contending it should not be confined only to racial segregation. He argued that using incorporation solely to evade local zoning regulations constitutes an improper motive that is 'destructive of the 'harmonious whole' and the legitimate expectations of settled, self-supporting communities.'
Analysis:
This case significantly clarifies the application of the Pennsylvania Borough Code, particularly regarding applicant motive and the interpretation of a 'harmonious whole' in incorporation proceedings. It limits judicial inquiry into an applicant's motivation unless constitutional concerns, such as racial discrimination, are present. Furthermore, it establishes a deferential standard of review for trial court findings on whether a proposed borough constitutes a harmonious whole, even when the development plan is unusual or controversial. This ruling could facilitate large-scale, single-entity developments in creating new municipal entities to control their own regulatory environment, potentially altering the balance of power between developers and existing local governments.
