It'll be interesting to see how this plays out in court.

ITT: lots of people arguing points that have no bearing on the actual matter.

If you're in a jurisdiction and the jurisdiction imposes a tax on your operation, you have to pay it or spend plenty of time in court. The R&N is no stranger to litigation, so I'm sure it's not the end of it for them. If you similarly enjoy litigation, feel free to make your own arguments before the appropriate authority.

But courts generally have no time for silly arguments like "what if someone was on the train and wasn't amused".

All depends how the law is written. Sales tax in Illinois is "Sales and Use Tax." If I buy something in Indiana but bring it into Illinois for use, I'm supposed to remit the tax to the Illinois Dept. of Revenue... Yeah, right. I sure hope they aren't holding their breath.

Maybe the Strasburg Rail Road has an advantage in that they are actually located in Ronks PA, which seems to be such a small place population-wise that perhaps they don't actually have much government and therefore not many types of taxes.

I can't speak to that. But I can tell you I found that statement VERY amusing!

The Strasburg RR is not located in Ronks PA.

Ronks is a US Census-Designated place on the North side of US 30 (Lancaster Pike), some 5 miles North of the Strasburg RR. It is on Amtrak's Harrisburg Line, and has no official standing in PA government; Ronks is in the governmental entity of East Lampeter Township, Lancaster County.

I think the confusion is because the USPS has decided to route mail to the Strasburg RR and RRMPA through the Ronks Post Office.

The Strasburg RR's East Strasburg Station and shop (and RRMPA) are in Strasburg Township. To the West is Strasburg Borough which was the original (1832) destination of the SRC. The East End of the Strasburg RR is in Paradise Township, including the connection at Leaman Place with the Philadelphia and Columbia RR (later PRR, PC and now Amtrak). All are in Lancaster County.

The Strasburg RR was built in the first place because the Philadelphia and Columbia RR was built through Lancaster and not Strasburg. The good burghers of Strasburg chartered their own Rail Road to connect with the Columbia RR.

Phil Mulligan

Thanks, Phil.

Got it. The mailing address threw me.

As an additional note that may prove interesting in this case, the municipality of Albany (in Berks County) specifically mentions 'railroads' as subject to the amusement tax there. And they do mention that the tax is only applicable 'within the Township', essentially as Jim Thorpe explicitly does.

There is, indeed, a qualification: the language is "railroads (except a railroad whose rates and services are fixed and regulated by the Pennsylvania Public Utility Commission). As we'd expect, a zoo or amusement-park railroad would be covered. But is LG&N either subject to rates fixed by or regulations, presumably including common-carrier regulations, from the Pennsylvania PUC? Are excursions and special trips so regulated?

There's also a provision that "'amusement' shall not include any form of entertainment accompanying or incidental to the serving of food or drink ... where the charge for admission is wholly included in the price paid for food or drink..." Jim Thorpe has partially covered this -- they state that if 'cover' of any kind exceeds the normally-charged cost of the meal, the overage is treated as 'admission' and taxable as amusement. But that says nothing about entertainment, like a dinner theatre, where the price of a meal includes entertainment. This would seem to have interesting implications for dinner trains.

In appreciating the rather local nature of the tax dispute to PA, you can also appreciate why RBMN would not necessarily roll over if you appreciate Berkheimer's record within the state as a contract tax collector. Part of it is the complexity of the local tax codes and the general unwieldiness of the approach, the other part is that they have a well-deserved reputation for being rather ham-handed about it.
https://www.bigclassaction.com/settleme ... lement.php
Enjoy the comments. Pass the popcorn. The real losers here are within Jim Thorpe and they'll feel the impact shortly. But if anybody has the stomach to take on Berkheimer, it's RBMN. On a lot of the nuisance wage tax issues, people just pay up rather than fight it, and like banks, I'm convinced they make more money in fines and interest than base contract amounts. With employees moving between taxing districts with different rates, non-residents, and wage ceiling issues, I can pretty much predict I'll have two or three irritated employees every year that get legal notices from Berkheimer on taxes they don't owe.
For those of you that are actually lawyers, here's the language of the Borough-specific amusements tax...
https://ecode360.com/14892991
Ample room for debate, on whether an activity that starts from Jim Thorpe and goes elsewhere is "within the Borough of Jim Thorpe" or if an activity that starts elsewhere and unloads there is eligible. It's not an ancient law (2010) and you'd think that if they actually intended to whack the railroad it would have been in the rather detailed activity description, just sayin', and its not. Gentlemen, start your lawyers.
In another municipality in PA, their ordinance specifically exempts bowling alleys, but includes campgrounds. And this catch language: "Has either its place of origin or place of termination within the geographic boundaries of the Borough; or" which would squarely address the gaping hole in Jim Thorpe's. What you have to remember is that every little town in PA has their own municipal council and lawyer, and some were paying attention in that meeting, and some were not....

Awwww, you beat me to posting the actual ecode360 listing.

Note that it is explicitly based on the Pennsylvania 'Local Tax Enabling Act, PL 1257, No. 511, which is in the code as 53 PS section 6901 et seq. 1983, as amended.

The key phrase that comes up here, once "within the Borough of Jim Thorpe", is this catchall (or intended to be so) boilerplate in Definitions (sec. 396-58) for 'Amusement'"

" ... and 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."

And this hinges much more on the act of ticket sales within Jim Thorpe than on actually taking tickets on the train -- unless the court reads more on the specific interpretation of 'obtaining' in this context (which in my mind would be as moronic as construing 'establishment of religion' in the American Constitution to be a euphemism for a church building.)

A further discussion might be on whether the admission in Jim Thorpe is a requirement to full enjoyment of the entertainment rendered outside Jim Thorpe. Most passengers are not paying the 'fare' on LG&N solely for the privilege of boarding and detraining in the Borough, and would therefore be satisfied without refund if the train failed to move and just sat there 'enjoying the view' for a couple of hours. Again this may hinge upon the interpretation of the above provision.

It may also bear mentioning that, if Andy is in fact providing the LG&N operations primarily as a 'labor of love', the existing Jim Thorpe regulations would let him completely out of the amusement tax if he demonstrated that "the proceeds thereof [would] inure exclusively to the benefit of any religious, charitable, civic, educational, or nonprofit organization". (sec. 396-60)

Presumably any 501(c)(3) effort qualifies prima facie as the last of these, even if Andy's general charitable giving didn't already extend to the amount of LG&N's receipts...

I note that several posts discuss the possibility of a tourist RR defeating an amusement tax by structuring its operation to more nearly resemble a federally regulated common carrier service. I don't think that would work. Federal law doesn't generally prohibit states or localities from taxing railroads. What Federal law does prohibit is discriminatory taxes against railroads (a practice that was pretty common prior to the northeastern railroad crisis of the late 60's and early 70's). An example would be a jurisdiction taxing railroad property at a much higher rate than taxing other commercial property in the jurisdiction. Discriminatory taxation was outlawed by Congress in the 1976 4R Act.

Isn't it LGSR?