Notice to Taxpayers
October 20, 2022
The Lower Merion Board of School Directors and District Administration are pleased that the proposed settlement in the 2016 case of Arthur Alan Wolk, Philip Browndeis and Catherine Marchand v. Lower Merion School District, No. 2016-01839, has been approved.
The Board and Administration believe that the best interests of the District's students and taxpayers have been served by bringing the ongoing litigation to a conclusion, allowing the District to focus on its primary mission of providing excellent educational opportunities to the children of Lower Merion and Narberth.
Click here for the October 20, 2022, court order.
For additional information, please see the Notice to Taxpayers below:
Notice for Wolk, Brandeis, and Marchand v. Lower Merion School District,
No. 2016-01839
Why did I receive this Notice?
The Court of Common Pleas of Montgomery, County Pennsylvania has ordered the parties in Wolk, Brandeis, and Marchand v. Lower Merion School District to send you this notice. If you have received this notice, it is because you have been identified as a property owner in the Lower Merion School District (“the District”) who paid school real property taxes (“school taxes”) in tax years 2016, 2017, 2018, 2019, 2020, 2021, and/or 2022.
Even if you previously received a postcard notice regarding the parties’ proposed settlement, please read this notice in its entirety. This notice contains supplemental information about the proposed settlement and the identity of taxpayers who would receive checks as part of the proposed settlement.
What is this lawsuit about?
Arthur Alan Wolk filed this lawsuit in the Court of Common Pleas of Montgomery County on February 1, 2016 against the District. Mr. Wolk filed the lawsuit on behalf of himself and on behalf of property owners in the Lower Merion School District who paid school taxes in tax years 2016, 2017, 2018, 2019, 2020, and/or 2021. This lawsuit included allegations about the District’s spending, budgeting, and tax increases. A preliminary injunction was issued on August 29, 2016 that ordered the District to change the 2016-2017 tax increase from 4.44% to 2.40%. The District denied the Plaintiffs’ allegations and denied that it is liable for the claims asserted.
Plaintiffs and the District have negotiated in good faith to resolve all claims subject to certain conditions. Plaintiffs and the District agree that it is in the best interests of the District, taxpayers, and the students of the District to settle this matter.
What is the monetary component of this settlement?
If the settlement is approved, the District will provide $15 million total to taxpayers who owned real property in the District at any point in tax years 2016, 2017, 2018, 2019, 2020, and/or 2021 and who paid their school real property taxes. Payments to the Settlement Class will be calculated as follows: The amount each taxpayer receives will be proportional to the amount of school taxes that taxpayer paid. The total amount of school taxes each taxpayer paid from 2016 through 2021 will be calculated as a percentage of the total amount of school taxes the District received from 2016 through 2021, and that percentage will be multiplied by $15 million to identify the amount each taxpayer will receive. (By way of example only, if the District received a total of $240 million in school taxes from 2016 through 2021, and if one taxpayer paid $12,000 total in school taxes during that time period, that taxpayer would receive a check for $750 (which is .005 percent of $15 million).)
Who would receive checks as part of this settlement?
There is a change in the proposed property owners who would receive checks as part of this settlement. Under the parties’ current proposal, property owners in the Lower Merion School District who paid school real property taxes in tax years 2016, 2017, 2018, 2019, 2020, and/or 2021 would receive a check from the $15 million portion of the proposed settlement.
What do I do if I am a taxpayer entitled to receive a check?
If the court approves the settlement, checks will automatically be distributed and you do not need to request a check. The checks will be sent within 45 days after the Order approving the terms of settlement is entered.
What would I release if I receive and cash a check?
If you receive a check and cash it, you will release (on your own behalf and on behalf of any of your affiliates, predecessors or successors in interest, heirs, assigns, and current and former agents,) the District and its respective affiliates, predecessors or successors in interest, heirs, assigns, and current and former agents, Directors, Administrators, employees, advisors, and counsel of and from any and all actions, claims, liabilities, suits, causes of action, debts, charges, complaints, obligations, demands, expenses, damages, attorneys’ fees, and debts that you had or now have, whether known or unknown, whether asserted or unasserted, for or by reason of any cause, matter, or thing whatsoever, whether pursuant to statute, common law, or otherwise, from the beginning of time to the date of the approval of the Settlement Agreement, including but not limited to the claims and counterclaims and causes of actions (except for Count VI), arising from or relating to the facts and matters alleged in Montgomery County Court of Common Pleas Civil Action No. 2016-01839, Wolk v. Lower Merion School District.
What if I receive a check and do not cash it?
You will have 120 days after the check is mailed to cash it. If you do not cash the check within 120 days, the check will become void and you will not participate in the settlement.
Which property owners will not receive a check?
Property owners who did not pay their school real property taxes from 2016-2021 will not receive a check because the amount each taxpayer is entitled to receive is based on the amount of real property taxes paid. These property owners will not be releasing any claims against the District.
Property owners who purchased property after tax year 2021 will not receive a check because these property owners will receive the benefit of the reduced millage rate described below. These property owners will not be releasing any claims against the District.
What are the other terms of the proposed settlement?
As part of the proposed settlement, the parties have also agreed to prospective structural relief, including (1) a school tax millage rate of 31.2045 for the 2022-2023 fiscal year; (2) a credit in the total amount of $4 million per year in tax bills to be sent in 2023, 2024, and 2025; and (3) the potential for certain credits to be applied to tax bills in those and future years, depending upon whether certain surpluses occur.
The reduced millage rate for 2022 applied to current property owners in the Lower Merion School District, and will result in a lower tax basis for all property owners going forward. The negotiated millage rate was calculated by (1) starting with the millage rate basis that would have been in place if the tax increase for 2016 had been 2.40% instead of 4.44%, which was part of the preliminary injunction order; (2) was increased to account for the tax increases implemented each year between 2016 and 2021; and (3) was further increased by 3.4%, which was the maximum amount of the index tax increase allowed under Act 1 for 2022-2023.
The credits in the tax bills for 2023 and forward will apply only to taxpayers who own property in Lower Merion School District in the years those tax bills are sent.
The District will also pay $100,000 in legal costs incurred by Arthur Alan Wolk, the attorney for the class, who served without an attorneys’ fee.
What if I previously owned property in the District at some point during 2016-2021 and have moved?
The Settlement Administrator will use reasonable efforts to identify property owners who have moved since August 29, 2016, including using the National Change of Address database and skip tracing for returned notices and checks. However, if you believe you are entitled to receive a check and have moved or are in the process of moving, you may update your address on record with the Settlement Administrator at the following addresses:
By email: info@LMSDbudgetsettlement.com
By Mail: LMSD Budget Settlement Administrator 1650 Arch Street, Suite 2210
Philadelphia, PA 19103
What if a person who owned property and paid school real property taxes at some point during 2016- 2021 has passed away?
If a person owned real property in the District in at least one of the tax years between 2016 – 2021 and paid school real property taxes but is now deceased, the check would go to the decedent’s estate. If you are the representative of such a person or the executor of such an estate, please contact the Settlement Administrator at LMSD Budget Settlement Administrator, 1650 Arch Street, Suite 2210, Philadelphia, PA 19103 by mail, or by email at info@LMSDbudgetsettlement.com for more information on the paperwork you need to provide.
When and where will the Court hold another hearing on the proposed settlement?
The Court will hold a supplemental hearing on October 18, 2022 at 9:30 a.m. Eastern Time in Courtroom 9 of the Montgomery County Courthouse in Norristown, Pennsylvania to assess further whether the terms of the parties’ proposed settlement are fair and reasonable. That hearing is open to the public. The Court will decide whether to approve the settlement after that hearing.
How do I get more information?
More information and a copy of the Settlement Agreement and parties’ related filings can be found at www.LMSDbudgetsettlement.com.
You also may submit written questions to the LMSD Budget Settlement Administrator, 1650 Arch Street, Suite 2210, Philadelphia, PA 19103 by mail, or by email to info@LMSDbudgetsettlement.com. Do not contact the Court directly for information.