Lithonia OperatorI am not sure, but I think Dave may have been referring to a railfan excursion that is not run on a regular schedule, or even necessarily by a tourist railroad.
You're probably right - I overlooked that qualification in his question.
Larry Resident Microferroequinologist (at least at my house) Everyone goes home; Safety begins with you My Opinion. Standard Disclaimers Apply. No Expiration Date Come ride the rails with me! There's one thing about humility - the moment you think you've got it, you've lost it...
Anything in other states is irrelevant to a legal proceeding in the state of Pennsylvania. It should be recognized that all these 'amusement' statutes are formulated under a specific statute, the "Local Tax Enabling Act" (PL 1257, No.511, at 53 PS section 6901 et seq. (1982) as amended) and that a number of their provisions are inherently governed by language in that Act. A discussion of some of the purpose and application of the Act around the time it was being invoked in local statutes after 2010 or so (the current Jim Thorpe Article VI replacing an older version around that time) can be found here (read down a bit).
Where I think the 'weasel words' most interesting to see entering precedent will be ... and I do think precedent of potentially multi-state consequence may follow if this gets litigated ... is in the specific boilerplate language used at the end of the section 396-58 'definitions' entry for 'Amusement':
... all other methods of obtaining admission charges, donations, contributions or monetary charges of any character, from the general public or a limited or selected number thereof, directly or indirectly, in return for other tangible property, or specific personal or professional service.
in conjunction with the definition of 'Admission':
The regular monetary charge for any character whatever, including donations, contributions, and dues or membership fees (periodical or otherwise), fixed and exacted, or in any manner received by persons as herein defined, from general public, or a limited or selected number thereof; directly or indirectly, for the privilege of attending or engaging in any entertainment or amusement.
The 'controversy' here is that, since the Act specifically applies only "within the Borough of Jim Thorpe" (and this is very specific language earlier in the definition of 'amusement'), does the cost of a train ride, substantially performed outside the Borough, all reside effectively in the 'permission' to board it? I think that it can be pretty easily agreed that, were the train to sit for several hours in Jim Thorpe without moving, or move up to the town line and back down a few times, you'd see considerably lower interest in LG&N trips or willingness to pay for the privilege -- nowhere near zero, of course, but not what the special gorge trips, such as the bicycle excursions, commanded.
(On the other hand, I do think it would be quite within the Borough's right to tax admission to the same train as, say, a 'tour of historic artifacts' should LG&N require paid tickets for that, without the train leaving Jim Thorpe. That's another hypothetical matter, no different from any other museum within Borough limits.)
As I mentioned on RyPN a while back, there is a 'ringer' in Jim Thorpe's statute that is explicitly not required under PL 1257: the complete immunity to 'amusement tax' if the full proceeds of admission are collected by a nonprofit organization (396-60 B). It should be noted that any 501(c)(3) organization automatically qualifies here ... including most railroad museums and quite a few 'friends' groups. Since Andy has gone on record as saying the LG&N is conducted as 'a labor of love' it would not be difficult for him to coordinate charitable contribution "in the amount of the LG&N receipts" to appropriate organizations, or in fact to establish his own ... shall we say, by way of example, to give 2102 a priority restoration? (The applicable law is silent on 'nonprofits' not being subject to control by an agency selling tickets within the Borough)
I am not sure, but I think Dave may have been referring to a railfan excursion that is not run on a regular schedule, or even necessarily by a tourist railroad. I am thinking of, for example, when NS used to run the mainline excursions with #1218. Now, maybe those in particular did not return to point A until the following day. But I am pretty sure there have been such excursions that did return the same day.
And aren't there preservation groups and rail clubs who occasionally run non-scheduled trains who make a round-trip on one day?
Did those passengers pay an amusement tax based upon where they boarded?
At least two have, as they are in the news for non-payment:
Maryland:
https://www.baltimoresun.com/news/bs-xpm-1995-04-18-1995108085-story.html
Colorado:
https://caselaw.findlaw.com/co-court-of-appeals/1440820.html
Connecticut's law (since repealed) specifically mentioned tourist lines:
https://portal.ct.gov/DRS/Publications/Special-Notices/1991/SN-91-5
Texas specifically mentions railroads:
(v) tour trains and buses, whose primary purpose is to show tourist sights along a route, as opposed to regular transportation;
I'm sure there are tourist lines paying such a tax without fanfare. In the case of Jim Thorpe, it's specifically stated that the passenger, not the railroad, pays the tax. Others are likely the same.
Has any out-and-back railfan excursion been hit by either for an amusement tax?
Overmod MidlandMike Counties and townships have taxing authority. Is an amusement tax available to the County? I can find no instance of a county, rather than a municipality, having amusement-tax authority. Interestingly, most municipality amusement-tax statutes don't contain the language stating that the amusement must take place 'in' the municipality. Albany, in Berks County, specifically includes 'railroad' under the definition of 'amusement' -- "except a railroad whose rates are fixed and regulated by the Pennsylvania Public Utility Commission."
MidlandMike Counties and townships have taxing authority. Is an amusement tax available to the County?
I can find no instance of a county, rather than a municipality, having amusement-tax authority.
Interestingly, most municipality amusement-tax statutes don't contain the language stating that the amusement must take place 'in' the municipality.
Albany, in Berks County, specifically includes 'railroad' under the definition of 'amusement' -- "except a railroad whose rates are fixed and regulated by the Pennsylvania Public Utility Commission."
In Illinois, both the City of Chicago and County of Cook have amusement taxes.
OvermodThat's very clear, 5% in Jim Thorpe. What is not yet clear is how much 'outside of' Jim Thorpe. As the statute is written, it seems clear to me that any part of the RT ride outside city limits is not taxable under any statute visible in ecode360.
Jim Thorpe is the county seat of Carbon County. Counties and townships have taxing authority. Is an amusement tax available to the County?
tree68 Flintlock76 And rdamon pointed it out pretty well, you can't drop a bombshell like this on a business and not expect there to be trouble. The question is how much of a bombshell was dropped. I think I saw one report that indicated that the railroad had been contacted several times over the past few years about this issue. At some point, it becomes, "Listen, we told you and you ignored us."
Flintlock76 And rdamon pointed it out pretty well, you can't drop a bombshell like this on a business and not expect there to be trouble.
The question is how much of a bombshell was dropped. I think I saw one report that indicated that the railroad had been contacted several times over the past few years about this issue.
At some point, it becomes, "Listen, we told you and you ignored us."
It's pretty hard to believe that this issue was totally dormant for a decade. Then suddenly it was a bolt from the blue? Seems doubtful, IMO.
Sounds more like something finally reached a boiling point. Could be personal, as suggested here. Could be a misunderstanding: perhaps assurances were made by someone verbally that the RR was not subject to the tax, but then the town government changed. Lots of scenarios can easily be imagined. But I'm doubting this was a bombshell surprise to RBMN.
Flintlock76On another note, I'm curious. Considering the spirited discussion here how many of you have actually ridden the Lehigh Gorge? Full disclosure, I haven't.
Full disclosure, I haven't.
I have not. I saw that JT was sort of on the way from Scranton to Stasburg, so we made a very quick stop, maybe 30 minutes. Glad we did, though. Found out what a great town it is, saw the RR, and we may return some day. On another thread, someone sugested visiting the town, and I am glad we did, albeit briefly.
Flintlock76And rdamon pointed it out pretty well, you can't drop a bombshell like this on a business and not expect there to be trouble.
Chances are it's going to wind up in court, and as the saying goes...
"You may lose, or I may lose, but the lawyers never do!"
No disrespect intended to any out there in the legal profession, but I'm sure you know the truth of that statement better than anyone.
And rdamon pointed it out pretty well, you can't drop a bombshell like this on a business and not expect there to be trouble.
On another note, I'm curious. Considering the spirited discussion here how many of you have actually ridden the Lehigh Gorge?
charlie hebdoAnd just how much is the amusement tax on a RT ride?
That's very clear, 5% in Jim Thorpe. What is not yet clear is how much 'outside of' Jim Thorpe. As the statute is written, it seems clear to me that any part of the RT ride outside city limits is not taxable under any statute visible in ecode360.
They would still be able to collect tax for the part within city limits, and they would collect it from individuals at the point of ticket sale or boarding, and the railroad could be made accountable for providing the corresponding amount 'per customer' if the city didn't do it directly (which they evidently never did).
The first 'finding of fact' does need to be whether LG&N's trips constitute 'amusement' under the statute. The second is whether something mostly conducted outside city limits can be taxed on its full value as though it were. The third is -- if it cannot, as I think will be the case -- how the basis for the tax can legally be determined (and this would effectively constitute new law, and may require action by the Pennsylvania legislature to amend). Now, that "might" theoretically involve a determination that the whole value of services rendered may be assessable based wholly on the point of origin, or split between the points of origin and destination, but I think that is comparatively unlikely for procedural reasons as well as political ones.
I suspect all this will come up in some context before any judgment on taxes "due" can be enforced on RBMN, but we may not read anything about it in general press coverage. On the other hand, this is a highly relevant subject to organizations like ARM/TRAIN, and it will be interesting to see if they participate in pending litigation...
Did they "Get Away" or is the current mayor looking for new revenue and expanding the scope?
Shame on the city if they were supposed to collect this 14+ years ago.
I am sure the 10 years back payment is what is causing the issue. If they said starting Jan 1 you need to start collecting this, it may be a different story.
But I am sure there is much much more going on than what we are reading.
And just how much is the amusement tax on a RT ride? Seems to me the railroad got away with tax avoidance for years and now, when called to task on it, threatens to end the excursion rides to try to blackmail the town into a lower settlement.
daveklepper I have no knowledge of what the Railroad's lawyers use to counter the claim, and I know enough not to ask.
You could certainly ask, and they might tell you. But this is not the place to ask, and certainly not the place to 'telegraph' what your strategy in actual court might be. You'd have to contact someone at RBMN directly.
We're only talking possibilities and applicable law here.
I think the successful counterclaim is that the Gorge is a destination, and the railroad simply provides transportation to and from the Gorge.
The issue here, as with a variety of other services, is whether it actually does that by a legal definition of transportation. You may recall that a different railroad rather cleverly tried extending its run to just cross a state line, then try to claim this was 'interstate transportation'. This "failed to thrive", and out of this came a couple of commonsense 'tests' that could be used to define when an operation is legitimate 'transportation' (meaning a common-carrier from one point to another) vs. when it is 'amusement' (meaning something that begins and ends at a common point, provided as a pastime).
One of these is that one-way ticketing needs to be provided, and some objective proof made that a substantial number of such tickets are used and it's not just a dodge to avoid an otherwise-applicable tax. Another of these is that there are clear facilities at any 'remote' end, at which riders could be picked up or discharged or at which are facilities they have some reason to reach. There have certainly been 'common-carrier' trains in the past that provided shopping access for people, and it might be noted that any train from "elsewhere" to Jim Thorpe is explicitly not being considered for the tax, so shuttle buses at the "Old Penn Haven" end connecting to shopping or other commercial attractions might qualify as a reason for exemption ... but they probably can't just be continuations of the train ride to other sources of amusement.
... as far as I can tell the railroad has tried to be a good citizen. It was the Town that percipitated the dispute, and using a collection agency to notify the railroad indicates that the Town does not seem interested in the worth of a good relationship.
I think this is near the heart of why Andy is so very upset at the situation. I think it is very clear that Jim Thorpe as a group of citizens gets at least as much as LG&N out of the 'tourist draw'; the problem is that the political administration in town wants their additional slice of pie too, without seemingly providing anything in any proportion to the demanded revenue.
And then gets nasty about it.
The railroad property near the Town but outside it could be a gold mine. All passenger operations could be moved to originate there, a Lehigh Gorge Hotel constructed, a camping ground, restaurants, a filling station, and plenty of parking. Possibly tennis courts, a football field, etc.
Doubt the development cost would be recoverable in actual revenue. Those things would best be outsourced (or developed as some kind of PUD, perhaps); RBMN to my knowledge is not associated with a building or developing company, although I'm sure Andy Muller 'knows people in the biz'.
And there is still the question whether an excursion service going through (but not stopping in) Jim Thorpe is subject to a pro-rata share of 'amusement' for the portion in transit, which I think will be determined in court 'eventually' in this matter and which a number of people on RyPN are following with some interest. If the property in question is 'south' of Jim Thorpe, this becomes a direct issue.
To my admittedly defective knowledge, the next 'large' attraction running north is considerably further than Old Penn Haven, and it may not be attractive to run that long a distance or a trip, especially if the amenities at the "other end" are not particularly good. That is especially so if the business model involves multiple trips a day.
The above would appear to be applicable if courts decide that the train ride is indeed an amusement/entertainmente/enjoyment (the Town's laws appear to regard these as synonynms, as per Middleman, and contrary to my own understanding of English, which defines them as different but overlapping. The law is what counts in this case.) and "not transportation."
The town picked the Lehigh Gorge run and not the other trips because, as they stated, the train brings riders back to the starting place and not to another destination. I have no knowledge of what the Railroad's lawyers use to counter the claim, and I know enough not to ask. But I think the successful counter claim is that the Gorge is a destination, and the railroad simply provides transportation to and from the Gorge.
Regarding the need for good relations between the railroad and the Town, there is no record of prior disputes to my knowledge, and as far as I can tell the railroad has tried to be a good citizen. It was the Town that percipitated the dispute, and using a collection agency to notify the railroad indicates that the Town does not seem intersted in the worth of a good relationship.
The railroad property near the Town but outside it could be a gold mine. All passenger operations could be moved to originate there, a Lehigh Gorge Hotel constructed, a camping ground, restaurants, a filling station, and plenrty of parking. Possibly tennis courts, a football field, etc.
I brought this up on RyPN when I read the appropriate ecode360 listing of the statute. I have not yet seen a discussion of precedent concerning any part of an 'amusement' that takes place outside city limits, but that's the only thing that might establish Jim Thorpe's ability to bill for 'the whole experience' and not just the small and comparatively unvalued part of it that occurs in town.
I also noticed that if the trips were to nominally begin and end just outside of city limits, with a 'free' shuttle bus put on to transport people to and from the train there, it would be technically legal tax avoidance under the statute as written.
I think that Jim Thorpe is within its rights to collect tax at a point of ticket sale within Jim Thorpe for an entertainment partially conducted there ... but not for any more tax than a pro rata share (either on a time or distance basis) for the bit that happens within city limits. I doubt you will find anyone riding the LG&N who thinks that the part of the trip occurring there is worth very much in terms of 'what they came to see and can't see from the town itself', so there won't be much hope if the town's representatives stand up in court and try to assert that boarding in town is a significant enough part of the 'experience' to bill tax for the whole.
I also noted, at least in passing, that if the town attempted to bill an excess of applicable tax ... and, of course, if my interpretation of the statute is correct, they most certainly have -- there may be other applicable law involved. That is particularly so if the town people have conducted anything abusive in their efforts to make the rail entities cough up.
In short, I do think the town has the right to 'tax' LG&N via the 'amusement tax' provision, but the amount they can tax for is probably orders of magnitude less than their 'back taxes' bill, and the recourse available to a resumed LG&N to avoid the tax in future may be substantial.
Another point. If riding the train ia entertainment and thus by your definition also amusement, only a tiny fraction occurs within the Town.
Train travel for many people is enjoyable. So are all trains amusement devices and train travel per se an amusement?
Seeing something awesome is usually enjoyable, but is it an amusement?
Amusement connotes a lack of seriousness, a seance of lightness, and legal terms should have some relevevance to reality.
I'll stay with my English, thanks.
All this railroad's passenger trains and probably most of what bus servoce the town has serve tourism for noessential trips. The railroad provides transportation to and from destiknations and not amusement. If there is amusement, it is something the passenger and possibly his or her fellow passengers develop.
"Mechanical amusement devices" means slot machines, pinball, arcade games. Might mean jukeboxes. Certainly doesn't mean tourist trains.
"The maximum tax imposed on mechanical amusement devices shall be $25 per device per annum."
According to the law, maybe the railroad only owes $25 per year for the last 10 years. I'm sure they would amend the law for future collections, but then maybe the railroad and town could come to some negotiated agreement. It's always better when the RR and town are in agrement. There are a number of operations where the town and RR got into a bug tussle, and it did not turn out good for the tourist line.
daveklepper... An enjoyable service that is non-essential, serious, and ejoyable, but not amusing:
More convoluted than any contortionist could imagine. It has been explained a number of times that "amusement" in the present context is a legal term, and is not subject to deconstruction for the sake of civil persuasion. Your arguement is rhetorical rather than factual.
daveklepper In my English vocabulary...
The local law lists those things that the amusement tax applies to. I quoted it a page or two back. Essentially, virtually any event you have to buy a ticket for, or otherwise pay admission, falls within the purview of the law.
Here is the tax rate:
§ 396-59Imposition and rate of tax. A. A tax is imposed, for general revenue purposes, upon the admission fee or privilege to attend or engage in any amusement within Jim Thorpe Borough at the rate of 5% of the established price charged to the general public, or a limited or selected group thereof, which shall be paid by the person acquiring such privilege, and not the owner or operator of such amusements. B. The tax base upon which the tax shall be levied shall be: (1) On admission to golf courses, 40% of the greens fees; (2) On admissions to bowling alleys, 40% of the charge imposed to engage in a game of bowling. (3) On mechanical amusement devices, 100% of gross reciepts; (4) On cover charges, 100% of the increased cost of admission; and (5) On admission to all other amusements, 100% of the cost of admission. C. Where no fixed admission fee is charged per individual, the tax shall be based upon the gross admission fees collected or received. D. The maximum tax imposed on mechanical amusement devices shall be $25 per device per annum.
Amusement is a term that refers to a pastime, diversion, or other enjoyable activity. It may be treated as synonymous with entertainment. It is a pleasurable occupation of the senses. The term may include participative entertainment as well as things of an exhibitory nature. An amusement generally involves the presence of multiple activities. Amusement may also be referred to the passing of time in pleasant or agreeable occupations.
1. My understanding is that nobody at the railroad had any idea that an amusement tax applied to any of their operations until served by a collection agency.
2. In my English vocabulary, a service does not have to be considered essential to be a serious service rather than an amusing one. An enjoyable service that is non-essential, serious, and ejoyable, but not amusing: the cake at a wedding ceremony. Not essential; certain very festive Jewish and Muslem weddings do not include wedding cakes in the festive meal. If you are in camp that considers a train to an awsome natural sight and site, and/or the sight and site itself as amusing, then your English vocabulary has differences from mine. (The cake nned not be awesome, however, and usuallyl is not. But sometimes, indeed, it can be amusing if made delibeately humerous, by amusing figiures for bride and groom, for example.)
Another non-essential trip, vacation trip, that is not amusing is the round-trip to the Gettysburg battlefield, or to Mt. Vernon, Monlticello, and Ashlawn, or to the Washington National Cemetary.
These trips may be enjoyable and non-essential. But in my English language, they are not amusing.
Is my understanding that JT is trying to collect 10 years of amusement tax? If so, isn't there some application of a staute of limitations?
My thoughts are that is really nothing much more than a steam heated urination contest between conflicting personalities.
Never too old to have a happy childhood!
I think I read that fourteen other entities in JT pay the amusement tax. I'd be interested to know what sort of businesses those are.
Regarding tree's point, I wonder if Andy would have opposed the tax if he had known about it all along, and could have just rolled it into the ticket prices. Most tourists would not even notice, much less balk. If you want to ride the train, you pay for the ticket. Now maybe Andy DID know all along, and simply opposed it in principal.
Does anyone know what percentage of a ticket price the tax requires? I doubt that part would have been a deal-breaker for anyone.
Is the railroad’s position that they did not know about the tax until they were presented with a bill just this year? Or did they know about the tax, and let the issue slide while believing that it was built into their ticket price if the City ever decided they wanted to collect it?
If it were the latter, they might have rationalized that the more time that passed without the City attempting collection, the less chance they owed it.
I'm afraid I'm in the camp of trips such as this being an amusement.
No one has to take the ride - they do so for the enjoyment of viewing the scenery and - yes - riding the train. No one is riding the train for the purpose of visiting Aunt Mary or conducting business at a distant destination.
In other words, this is not anything resembling an essential service.
What I'm still curious about is why this problem was not discovered some 14 years ago. As has been noted, this would not be money out of the railroad's pocket. The customers would have paid the tax as an add-on to their ticket purchase.
And, as Paul notes, all they have to do in order to continue to offer trips into the Gorge is board their passengers outside the Borough of Jim Thorpe. Problem solved. Even if they stop to allow the passengers some time there.
Alternatively, a few miles south of Jim Thorpe is Lehighton, the site of a former major Lehigh Valley RR yard and shop complex - at its northern end is Packerton Jct. It's at the southern end of what shows as a short RBM&N branch line- the northern end is Jim Thorpe. There's a lot of open space there - see N 40.85168 W 75.71250 , and even more Lehigh River scenery from there to Jim Thorpe. It's also that many miles closer to the major roads that lead to JT, especially the PA Turnpike (I-476) and PA 248 and 443, and less miles on US 209 which goes to JT. Said another way, most people driving to JT go through Lehighton first.
- PDN.
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