By Hallie Lauer
Pittsburgh Post-Gazette
(TNS)
Apr. 10—Attorneys for the city of Pittsburgh argued in front of the Pennsylvania Supreme Court on Thursday morning, maintaining that the collection of the 3% facility usage fee was legal and didn’t violate the state constitution.
The fee often called the “jock tax” is a 3% charge applied to income out-of-state athletes and performers make while using PPG Paints Arena, PNC Park and Acrisure Stadium.
The collection of that fee has been in litigation since 2019, when three professional athletes—Scott Wilson, a former Pittsburgh Penguin; Kyle Palmieri, a right winger for the New York Islanders; and Major League Baseball outfielder Jeff Francoeur—sued the city. The NFL, NHL and MLB later joined the lawsuit.
In the original filing, the athletes said they paid more than $25,000 to the city under the fee. Officials anticipate collecting more than $6 million in tax revenue via the fee this year, according to the 2025 budget.
In January 2024, the Pennsylvania Commonwealth Court ruled that the jock tax was unconstitutional because it treats residents and nonresidents differently. That court upheld a decision made by a lower court.
Since its appeal to the state Supreme Court, the city has remained optimistic that it will prevail in the litigation.
When the state Supreme Court agreed to hear the case last summer, it decided to only listen to arguments on how that uniformity clause should be interpreted—namely whether residents and non-residents needed to be treated the same or if there was room for “rough uniformity.”
Attorneys for the city argued in the lower court that there was no distinction. Considering that out-of-town athletes pay the 3% fee while local athletes pay a 2% school tax and 1% income tax, they argued that made things uniform.
Thursday morning’s arguments took a similar tone.
Attorney Yazan Ashrawi, representing the city, said that the facility-usage fee equalizes the earned income tax burden.
But the attorney representing the players associations and individual athletes, Ryan McManus pushed back on that notion, pointing to state law that prohibits school district tax from being applied to nonresidents.
“The city tries to manufacture uniformity by pointing to the 2% tax for school districts that residents pay,” he said, arguing that it wasn’t a uniform tax because legally nonresidents don’t have to pay a school district tax.
The fee also doesn’t apply to everyone uniformly, Mr. McManus argued. It “singles out professions and treats them differently,” he said.
During Commonwealth Court’s review of the case, the city conceded that it was indeed a tax and not a fee, which have different legal definitions. Mr. Ashrawi also said that because it is indeed a tax, athletes and performers can claim a tax credit on their filings so that they are not taxed twice on their earned income.
But athletes and entertainers haven’t been able to apply for a credit because they didn’t believe there was legal standing, Mr. McManus argued.
Further, the city’s instructions still state that the fee should not be listed on the athletes’ or entertainers’ W-2 forms. Mr. McManus said that should have been changed when the city conceded that the 3% was a tax and not a fee.
Mr. Ashrawi confirmed that “to the best of [his] knowledge” no regulations have been changed by the city because the city was waiting to see what action the courts took.
“The city was waiting on some finality on what this law may or may not look like at the end of the day,” he said.
In a rare move, the court requested another briefing with the attorneys to get further details on what actions the city has taken since acknowledging the 3% tax as a tax, not a fee, and if the city is providing tax credits to the athletes and entertainers.
Dates for the briefing have not yet been determined.
If the court ultimately decides to strike down the fee collection, Pittsburgh may have to refund a portion of the fees collected over the past few years.
City Controller Rachael Heisler has said she is “concerned about whether the city can continue to rely on revenue from the facility usage fee.”
The city is staring down some budgetary shortfalls as federal COVID-19 relief funding is set to expire, property tax revenue is decreasing and debt service payments are scheduled to increase in the next few years.
Photo caption: Acrisure Stadium, home to the NFL’s Pittsburgh Steelers. (BD Images/Alamy Stock Photo)
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© 2025 the Pittsburgh Post-Gazette. Visit www.post-gazette.com. Distributed by Tribune Content Agency LLC.
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Tags: Income Taxes, jock tax, Pennsylvania, Pittsburgh, Taxes
