           IN THE COMMONWEALTH COURT OF PENNSYLVANIA


Greenwood Gaming and                             :
Entertainment, Inc.,                             :
                               Petitioner        :
                                                 :
                v.                               :    No. 609 F.R. 2015
                                                 :    Submitted: April 10, 2019
Commonwealth of Pennsylvania,                    :
                     Respondent                  :


BEFORE: HONORABLE MARY HANNAH LEAVITT, President Judge
        HONORABLE ROBERT SIMPSON, Judge1
        HONORABLE P. KEVIN BROBSON, Judge
        HONORABLE PATRICIA A. McCULLOUGH, Judge
        HONORABLE ANNE E. COVEY, Judge
        HONORABLE MICHAEL H. WOJCIK, Judge
        HONORABLE ELLEN CEISLER, Judge


OPINION BY JUDGE BROBSON2                             FILED: September 30, 2019

                Greenwood Gaming and Entertainment, Inc. (Taxpayer) has filed
exceptions3 to the September 6, 2018 Memorandum Opinion and Order of this




       1
        This matter was assigned to the opinion writer before September 1, 2019, when Judge
Simpson assumed the status of senior judge.
       2
           This case was reassigned to the authoring judge on May 28, 2019.
       3
           Pennsylvania Rule of Appellate Procedure 1571(i) provides, in relevant part:
       Any party may file exceptions to an initial determination by the court under this
       rule within 30 days after the entry of the order to which exception is taken. Such
       timely exceptions shall have the effect . . . of an order expressly granting
       reconsideration of the determination previously entered by the court.
Pa. R.A.P. 1571(i).
Court,4    which     granted     Respondent      Commonwealth         of    Pennsylvania’s
(Commonwealth) application for summary relief and affirmed the order of the Board
of Finance and Revenue (F&R) that denied Taxpayer’s petition for refund of
$1,122,654.89 in taxes paid based on gross terminal revenue during the period of
January 1, 2009, through January 4, 2011 (Tax Period). “In tax appeals from [F&R],
this Court functions as a trial court, and exceptions filed pursuant to
Pa. R.A.P. 1571(i) have the effect of an order granting reconsideration.” Consol.
Rail Corp. v. Cmwlth., 679 A.2d 303, 304 (Pa. Cmwlth. 1996) (en banc), aff’d,
691 A.2d 456 (Pa. 1997).
              In its Petition for Review, Taxpayer challenges F&R’s determination,
which denied Taxpayer’s petition for refund for lack of subject matter jurisdiction
and relied upon Section 3003.1(a) of the Tax Reform Code of 1971 (Code).5
Section 3003.1(a) of the Code provides:
                     For a tax collected by the Department of Revenue
              [(Department)], a taxpayer who has actually paid tax,
              interest or penalty to the Commonwealth or to an agent or
              licensee of the Commonwealth authorized to collect taxes
              may petition the Department . . . for refund or credit of the
              tax, interest or penalty. Except as otherwise provided by
              statute, a petition for refund must be made to the
              [D]epartment within three years of actual payment of the
              tax, interest or penalty.
(Emphasis added.) This Court frequently reviews matters that require application of
a statute to particular facts and circumstances. We did that in reviewing this matter
initially. As reflected in the Court’s Memorandum Opinion, we sided with the

       4
          Greenwood Gaming & Entm’t, Inc. v. Cmwlth. (Pa. Cmwlth., No. 609 F.R. 2015, filed
Sept. 6, 2018).
       5
         Act of March 4, 1971, P.L. 6, as amended, added by the Act of July 1, 1985, P.L. 78,
72 P.S. § 10003.1(a).


                                             2
Commonwealth’s position and held that Taxpayer’s petition for refund was
untimely. Taxpayer’s exceptions once again provide us the opportunity to review
the question of whether F&R erred in applying the three-year statute of repose in the
Code6 to Taxpayer’s petition. To aid our review, we requested supplemental briefs
from the parties, limited to the question of whether, as a matter of statutory
construction, the three-year statute of repose in Section 3003.1(a) of the Code7
applies to Taxpayer’s petition for refund in this case, which sought only a credit
against future tax liability. No court should ever apply a statute that, by its terms,
plainly does not apply under the circumstances simply because the parties invite us
to do so. See Estate of Sanford v. Comm’r of Internal Revenue, 308 U.S. 39, 51
(1939) (“We are not bound to accept, as controlling, stipulations as to questions of
law.”).
                To determine whether Section 3003.1(a) of the Code bars Taxpayer’s
petition for refund in the nature of an adjustment/credit pursuant to 61 Pa. Code
§ 1008.1(c)(5), this Court is guided by the Statutory Construction Act of 1972,
1 Pa. C.S. §§ 1501-1991, which provides that “[t]he object of all interpretation
and construction of statutes is to ascertain and effectuate the intention of the General
Assembly.” 1 Pa. C.S. § 1921(a). “The clearest indication of legislative intent is


       6
           Act of March 4, 1971, P.L. 6, as amended, 72 P.S. §§ 7101-10004.
       7
          Statutes of repose differ from statutes of limitation in that the latter “are procedural
devices which bar recovery on a viable cause of action, whereas statutes of repose are substantive
in nature because they extinguish a cause of action and preclude its revival.” Altoona Area Sch.
Dist. v. Campbell, 618 A.2d 1129, 1134 (Pa. Cmwlth. 1992), aff’d, 631 A.2d 1010 (Pa. 1993).
Additionally, statutes of limitation begin to run only once an injury is discovered, whereas statutes
of repose run upon an event established in the statute, regardless of the occurrence or discovery of
injury. Id. at 1134-35. The three-year limit in Section 3003.1(a) of the Code is a statute of repose.
DaimlerChrysler Corp. v. Cmwlth., 885 A.2d 117, 120-21 (Pa. Cmwlth. 2005), aff’d, 927 A.2d 201
(Pa. 2007).

                                                 3
generally the plain language of a statute.” Walker v. Eleby, 842 A.2d 389, 400
(Pa. 2004). “When the words of a statute are clear and free from all ambiguity, the
letter of it is not to be disregarded under the pretext of pursuing its spirit.” 1 Pa. C.S.
§ 1921(b). It is presumed “[t]hat the General Assembly intends the entire statute to
be effective and certain.” 1 Pa. C.S. § 1922(2). Thus, no provision of a statute shall
be “reduced to mere surplusage.” Walker, 842 A.2d at 400.
             Moreover, “[e]very statute shall be construed, if possible, to give effect
to all its provisions.” 1 Pa. C.S. § 1921(a). We, therefore, must be careful not to
interpret sections of a statute in a vacuum.            Iacurci v. Cty. of Allegheny,
115 A.3d 913, 916 (Pa. Cmwlth. 2015). As the Pennsylvania Supreme Court has
explained:
                    When interpreting a statute, courts should read the
             sections of a statute together and construe them to give
             effect to all of the statute’s provisions. In giving effect to
             the words of the legislature, we should not interpret
             statutory words in isolation, but must read them with
             reference to the context in which they appear.
Roethlein v. Portnoff Law Assocs., Ltd., 81 A.3d 816, 822 (Pa. 2013) (citation
omitted).
             In our June 10, 2019 Memorandum Opinion and Order requesting
supplemental briefing from the parties, we raised the question of whether the
reference to a petition for “refund or credit” in the first sentence of
Section 3003.1(a) of the Code but a subsequent reference only to a “petition for
refund” in the statute of repose language should be interpreted to mean that the
statute of repose applies only when a party is petitioning for a refund of taxes and
not for a credit. The Pennsylvania Supreme Court came close to answering this
question once.     In Mission Funding Alpha v. Commonwealth, 173 A.3d 748
(Pa. 2017), the Supreme Court analyzed the three-year statute of repose in
                                            4
Section 3003.1(a) of the Code for purposes of determining when the period begins
to run. In that case, the taxpayer filed a petition for refund with the Board on
September 16, 2011, seeking an actual refund of its 2007 franchise tax liability in
the amount of $66,344. The Supreme Court held the “actual payment of the tax,”
which triggers the running of the three-year statute of repose to seek a refund, is the
point at which the taxpayer transfers money or credits to the Department and the
Department accepts the same in satisfaction of the taxpayer’s tax liability. Mission
Funding, 173 A.3d at 763.        Applying this interpretation, the Supreme Court
determined that the taxpayer actually paid its tax liability on April 15, 2008, when
the tax was due and payable and when the Department accepted the taxpayer’s
estimated tax payments and credits in satisfaction of the taxpayer’s 2007 tax
obligation. Id. at 759-60, 763. Accordingly, the taxpayer’s refund petition, filed in
September 2011, was late.
             In a footnote to its opinion, the Supreme Court noted that the taxpayer
raised an alternative argument, that being that the Supreme Court should treat the
taxpayer’s petition for refund as a petition for credit. In the taxpayer’s view, the
three-year statute of repose in Section 3003.1(a) of the Code did not apply to a
petition for credit. Id. at 763, n.14. According to the Supreme Court’s opinion, the
taxpayer in Mission Funding only ever sought a refund in the case and never a credit.
Id. Moreover, the taxpayer never advanced an alternative argument that it was
seeking a “petition for credit” before the Board, F&R, or this Court. Id. The
Supreme Court, therefore, refused to address this argument, considering it waived.
Id.
             Here, unlike the taxpayer in Mission Funding, Taxpayer has only ever
sought a credit (as opposed to an immediate refund) against future tax liability as a


                                          5
remedy for the alleged overpayment of taxes. In its supplemental brief, Taxpayer
argues why it believes that the statute of repose language in Section 3003.1(a) of the
Code, which refers only to a petition for refund, should not apply in instances where
the petitioning taxpayer seeks a credit and not a refund. In its supplemental brief,
the Commonwealth argues, by reference to other provisions of the Code, that the
reference to “petition for refund” in the statute of repose should be read to encompass
petitions that seek either a refund or credit with respect to overpaid taxes. Of the
two, the Commonwealth presents the more compelling argument.
             As noted above, legislative intent controls in matters of statutory
construction. The first sentence of Section 3003.1(a) of the Code authorizes a
taxpayer to petition the Department for either a refund or credit with respect to any
tax that the Department collects. The second sentence provides the statute of repose,
requiring that “a petition for refund” must be submitted to the Department within
three years of the actual payment of the tax. At first blush, the use of the word refund
in isolation suggests that the statute of repose does not apply when the taxpayer
petitions for a credit. Indeed, there is some authority from our Supreme Court to
support the view that, from a relief perspective, tax credits and tax refunds are not
the same. See City of Phila. v. City of Phila. Tax Review Bd. ex rel. Keystone Health
Plan E., Inc., 132 A.3d 946, 953-54 (Pa. 2015) (“Applying these same principles to
credits, we hold the Commonwealth Court did not err in affirming the Review
Board’s award of credits to [the t]axpayers. Ambiguity here is found only if credits
and refunds are the same thing, and whatever their similarities, they are not. ‘Store
credit’ is not the same as ‘your money back.’ The pertinent provisions [of The
Philadelphia Code] discuss terms of ‘credits’ and ‘refunds’ distinctly.”).




                                           6
               Upon further consideration, however, such a construction of the statute
of repose provision would be contrary to the General Assembly’s intent. The
question is not whether a “credit” and a “refund” are synonymous; rather, we need
only decide whether a “petition for refund,” as that phrase is used in Section 3003.1
of the Code,8 is the filing by which a taxpayer may seek either from the Department.
We conclude that it is. Indeed, the subsection following the statute of repose in
Section 3003.1 of the Code resolves the question. This subsection relates to refunds
or credits following the Department’s issuance of an audit report. While the
subsection does not apply in this case, the statutory language adds context to our
interpretation of the statute of repose:
               The [D]epartment may grant a refund or credit to a
               taxpayer for all tax periods covered by a departmental
               audit. If a credit is not granted by the [D]epartment in the
               audit report, the taxpayer must file a petition for refund for
               taxes paid with respect to the audit period within six
               months of the mailing date of the notice of assessment,
               determination or settlement or within three years of actual
               payment of the tax, whichever is later.
Section 3003.1(b) of the Code, 72 P.S. § 10003.1(b) (emphasis added). The
subsection authorizes refunds and credits and treats a “petition for refund” as the
filing by which a taxpayer seeks either.
               In addition, we note that Section 3003.1(a) of the Code applies broadly
to requests for refunds or credits of all taxes that the Department collects. One such
tax is the state sales tax. Section 253(a) of the Code, 72 P.S. § 7253(a), expressly
provides for the refund or credit of overpaid sales tax: “[T]he refund or credit of tax,
interest or penalty . . . shall be made only where the person who has actually paid
the tax files a petition for refund with the Department under Article XXVII within the

      8
          Added by the Act of July 1, 1985, P.L. 78, 72 P.S. § 10003.1.

                                                7
time limits of [S]ection 3003.1.” (Emphasis added.) By this language, the General
Assembly expressed its clear intent that a timely filed petition for refund under
Section 3003.1(a) of the Code is the vehicle by which a taxpayer must seek a refund
or credit for overpaid state sales tax.9
               In light of the foregoing, we cannot interpret the phrase “petition for
refund” in Section 3003.1(a) of the Code narrowly to exclude petitions that seek a
credit (rather than a refund) of overpaid taxes without contradicting the intent of the
General Assembly. We are, therefore, satisfied that the statute of repose applies to
all petitions for refund filed with the Department under Section 3003.1(a) of the
Code, regardless of the form of relief the taxpayer seeks. The statute of repose,
therefore, applies to Taxpayer’s petition in this matter.
               Turning now to the exceptions, Taxpayer mostly restates the same
arguments thoroughly addressed in our prior Memorandum Opinion. Finding no
basis upon which we should disturb that disposition, Taxpayer’s exceptions are
denied.     See Consol. Rail Corp., 679 A.2d at 304; Kalodner v. Cmwlth.,
636 A.2d 1230, 1231-32 (Pa. Cmwlth. 1994) (en banc), aff’d, 675 A.2d 710
(Pa. 1995).
               The remaining question posed by Taxpayer’s exceptions is whether the
emphasis that Taxpayer places on the substantive source for the credit it sought from
the Department in this matter—i.e., Section 1001.8(c)(5) of the Department’s




       9
          Our conclusion is further bolstered by our review of the Code and the Pennsylvania Race
Horse Development and Gaming Act (Gaming Act), 4 Pa. C.S. §§ 1101-1904, which imposes the
tax at issue here. In neither statute do we find any separate and specific provisions recognizing a
“petition for credit” and setting forth procedures with respect to the filing thereof.


                                                8
regulations10—warrants a different result from that set forth in the Court’s
Memorandum Opinion. It does not. In this case, Taxpayer sought a credit for the
amount of slot machine tax it allegedly overpaid to the Department during the Tax
Period, to be applied against future slot machine tax due. Taxpayer did so by filing
a “petition for refund” with the Department, thereby invoking the procedures set
forth in the Code. As interpreted above, under the Code, the taxpayer seeking a
refund or credit of taxes paid to the Department must file a “petition for refund” with
the Department “within the time limits of [S]ection 3003.1.” 72 P.S. § 7253(a).
“[T]his time limitation is absolute.” Silberman v. Cmwlth., 738 A.2d 508, 509 (Pa.
Cmwlth. 1999). Accordingly, regardless of the substantive law on which Taxpayer
bases its credit claim, the procedure that Taxpayer invoked to seek relief from the
Department compelled the Department’s dismissal of its petition for refund as
untimely.




      10
           61 Pa. Code § 1001.8(c)(5). Section 1001.8(c)(5) of the Department’s regulations
provides, in relevant part:
      Taxes and other assessments due as determined by the Department shall remain
      payable by the licensed gaming entity and certificate holder to the Department in
      accordance with [S]ection 1501(a) of the [Gaming A]ct (relating to responsibility
      and authority of [D]epartment) regardless of any discrepancies between the
      licensed gaming entity’s and certificate holder’s calculation and that of the
      Department’s or amounts contested by any party concerning the credit against taxes
      due. Resolution of disputed payments due will be addressed by the Department
      through adjustments it makes to its calculation of future payment amounts due. The
      Department may make adjustments to its calculation of future payment amounts
      due after resolution of any dispute regarding the amount of taxes due.

                                              9
            Accordingly, for the above-stated reasons, Taxpayer’s exceptions are
denied and F&R’s order is affirmed.




                                      P. KEVIN BROBSON, Judge

Judge Fizzano Cannon did not participate in the decision of this case.




                                        10
          IN THE COMMONWEALTH COURT OF PENNSYLVANIA

Greenwood Gaming and                  :
Entertainment, Inc.,                  :
                       Petitioner     :
                                      :
           v.                         :   No. 609 F.R. 2015
                                      :
Commonwealth of Pennsylvania,         :
                     Respondent       :



                                    ORDER


           AND NOW, this 30th day of September, 2019, the exceptions filed by
Greenwood Gaming and Entertainment, Inc. (Taxpayer) to this Court’s
Memorandum Opinion and Order in Greenwood Gaming and Entertainment, Inc. v.
Commonwealth (Pa. Cmwlth., No. 609 F.R. 2015, filed September 6, 2018) are
DENIED.      The order of the Board of Finance and Revenue dated
September 22, 2015, is AFFIRMED. Judgment is entered against Taxpayer and in
favor of the Commonwealth of Pennsylvania.




                                     P. KEVIN BROBSON, Judge
