The University of Scranton is suing the city over a new tax city officials enacted this year on parking garages and parking lots and is refusing to pay it until a judge weighs in.
The university filed suit in Lackawanna County Court on Friday, asking a judge to declare the university – a nonprofit – exempt from the city’s 15 percent tax on parking facilities where patrons pay to park.
City officials have said the tax is critical to bringing in more revenue for the financially distressed city. Council’s 2012 budget estimates the tax will bring in $500,000.
If a judge ruled in the university’s favor, city Business Administrator Ryan McGowan said the city would lose out on a “substantial amount” of revenue from the tax. He could not immediately provide specific numbers when contacted about the suit Friday afternoon.