Pennsylvania Code
Title 12 - COMMERCE, TRADE AND LOCAL GOVERNMENT
Part V - Community Affairs and Development
Subpart D - Local Earned Income Tax
Chapter 151 - LOCAL EARNED INCOME TAX
MEDIATION
Section 151.41 - Rules for mediation

Universal Citation: 12 PA Code ยง 151.41

Current through Register Vol. 54, No. 44, November 2, 2024

The following practices and procedures for mediation apply.

(1) One or more affected political subdivisions shall give written notice to the tax collection committee and the Department of the desire to submit the disputed matter to mediation by the Department. Thereafter, the political subdivision, tax collection committee and tax officer shall mediate in accordance with this section.

(i) Only a political subdivision may initiate a mediation request.

(ii) A political subdivision shall send the notice by regular mail.

(iii) The notice must include a statement indicating whether or not the dispute is subject to mandatory mediation. If a dispute involves a 10% or greater deviation from taxes received in the previous tax year, the parties are subject to mandatory mediation. If a dispute involves less than the 10% threshold, the parties may agree to undergo voluntary mediation in accordance with this section.

(2) Upon receipt of the notice, the Department will provide a copy of the notice to the tax officer. Within 20 days of the submission of the notice, the political subdivision, tax collection committee and tax officer shall each submit a written statement, not exceeding five pages, to the Department and the affected parties stating their positions as to the disputed and undisputed facts and issues in the case and whether prior settlement negotiations have occurred. The Department may decline to consider any information within a statement filed after the 20-day deadline.

(3) Within 30 days of the Department's receipt of the notice, the Department will determine whether the dispute meets the threshold conditions for mandatory mediation set forth in paragraph (1)(iii).

(i) If the issue being mediated is the same for more than one political subdivision, the political subdivisions shall combine their notices into one notice, which may not exceed five pages.

(ii) The Department's determination is final and not subject to appeal.

(iii) The Department will provide written notice of its determination to all affected parties within 5 days of its determination. The Department may provide the notice by e-mail, if available.

(iv) The Department will assess a fee to cover costs incurred by the Department in reviewing the mediation notice submitted by the political subdivision and the responses thereto. The Department will equitably apportion the costs among the affected parties by assessing each affected party only for the costs incurred by the Department when reviewing that particular affected party's notice and written statements. If two or more affected parties file a joint statement or notice, the costs incurred by the Department for reviewing the joint filing will be equally divided among those jointly-filing affected parties. The Department will notify the parties in writing of the fee assessment. The fee is not refundable and not subject to appeal. The parties shall pay their assessed portion of the fee by check within 30 days of notification of assessment by the Department.

(4) If the Department determines that the dispute requires mandatory mediation, the Department will refer the matter to the Pennsylvania Office of General Counsel Dispute Resolution Coordinator simultaneously with the written notice provided under paragraph (3)(iii). The coordinator will appoint an Office of General Counsel mediator to mediate the dispute. The selection of the mediator is final and not subject to appeal. The mediator will seek the parties' mutual agreement to extend the time period for mediation if the mediator and the Department believe that the extension may be necessary. The mediator will complete the mediation no later than 30 days following the Department's written notice provided in paragraph (3)(iii) unless the time period is extended by the mutual agreement of the parties to the mediation. Except as otherwise provided in this section, the mediation will be conducted under the rules in the Office of General Counsel Mediation Handbook. If the mediator incurs costs or imposes other mediation fees upon the parties, the costs or fees, or both, will be equitably assessed. The assessment is final and not subject to appeal.

(i) The parties shall participate in the mediation in good faith. The parties shall have an official authorized to settle the matter on their behalf available at the mediation. The mediator may require a party that fails to participate in good faith to pay all the costs of the mediation.

(ii) The mediator may request that Department personnel be present for all or a portion of the mediation.

(5) If the Department determines that the dispute involves voluntary mediation, all parties involved in the mediation, including the Department, may agree to mediate the issue through the Pennsylvania Office of General Counsel Dispute Resolution Program. The agreement to voluntarily mediate shall be made within 5 days of the Department's written notice provided in paragraph (3)(iii). Upon agreement by the parties to voluntary mediation, the Department will immediately refer the matter to the Office of General Counsel Dispute Resolution Coordinator. The coordinator will appoint a mediator to mediate the matter. The selection of the mediator is final and not subject to appeal. The mediator will seek the parties' mutual agreement to extend the time period for mediation if the mediator and the Department believe that the extension may be necessary. The mediator will complete the mediation no later than 30 days following the agreement by the parties to mediate the issue unless the time period is extended by the mutual agreement of the parties to the mediation. Except as otherwise provided in this section, the mediation will be conducted under the rules in the Office of General Counsel Mediation Handbook. If the mediator incurs costs or imposes other mediation fees upon the affected parties, the costs or fees, or both, will be equitably assessed. The cost assessment is final and not subject to appeal.

(i) The parties shall participate in the mediation in good faith. The parties shall have an official authorized to settle the matter on their behalf available at the mediation. The mediator may require a party that fails to participate in good faith to pay all the costs of the mediation.

(ii) The mediator may request that Department personnel be present for all or a portion of the mediation.

(6) Mediation sessions are closed to the public and are not subject to the requirements of 65 Pa.C.S. Chapter 7 (relating to Sunshine Act).

(7) Offers or settlements made in a mediation session, excluding the final written settlement agreement, are not admissible as evidence in subsequent judicial or administrative proceedings in accordance with 42 Pa.C.S. § 5949 (relating to confidential mediation communications and documents).

(8) If a settlement is reached during the mediation, the Department will prepare a written settlement agreement and obtain all necessary signatures within 30 days of the agreement of the parties to settle the issue. The settlement agreement is binding upon the parties to the agreement. The settlement agreement is subject to the Right-to-Know Law (65 P.S. §§ 67.101-67.3104). The agreement is admissible as evidence in subsequent judicial or administrative proceedings in accordance with the Pennsylvania Rules of Court, the Pennsylvania Rules of Evidence and 42 Pa.C.S. § 5949.

(9) If the mediation does not result in a written agreement signed by the parties as provided in paragraph (8), the mediation is deemed unsuccessful unless all parties and the Department agree in writing to extend the mediation. The mediator may determine that the mediation is unsuccessful and terminate the mediation if the parties have not executed a settlement agreement by the ending date of the extension or of any further extension agreed upon by the affected parties and the mediator.

Disclaimer: These regulations may not be the most recent version. Pennsylvania may have more current or accurate information. We make no warranties or guarantees about the accuracy, completeness, or adequacy of the information contained on this site or the information linked to on the state site. Please check official sources.
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