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<\/p>\nThe Scranton School District sued to reverse a property tax exemption on a $24.6 million building on Montage Mountain owned by the state\u2019s largest cyber charter school, the nonprofit Commonwealth Charter Academy.<\/p>\n
A tax-appeal lawsuit filed Monday in Lackawanna County Court by the school district against the Harrisburg-based CCA and the Lackawanna County Board of Assessment Appeals challenges the appeal board\u2019s full tax exemption granted last month to CCA.<\/p>\n
Cyber charter schools do not charge families for students to attend; home school districts pay for them to attend the cyber schools.<\/p>\n
The Scranton School District tax appeal lawsuit calls into question whether CCA is a \u201cpurely public charity\u201d under law and thus entitled to property tax exemption, and whether parts of the building are leased out to private tenants and thus should be subject to paying property taxes.<\/p>\n
In a statement Wednesday to The Times-Tribune, a CCA official disputed claims raised by the school district, calling them incorrect and based on outdated information.<\/p>\n
According to the suit:<\/p>\n
\u2022 CCA bought the three-story, 182,987-square-foot former Cigna office building at 53 Glenmaura National Boulevard for $17.8 million on Dec. 19, 2022. The property straddles the Scranton-Moosic border in the Glenmaura Corporate Center.<\/p>\n
\u2022 Lackawanna County\u2019s reassessment completed in 2025 for 2026 assessed the CCA property on Montage Mountain at $24,622,280. CCA appealed that assessement and sought a full exemption on property taxes. On June 22, the county tax appeals board granted a full exemption, reducing the assessement to $0.<\/p>\n
\u2022 The academy\u2019s cyber students receive instruction remotely via internet and do not attend classes at 53 Glenmaura Boulevard, which \u201cdoes not function as a traditional school building.\u201d<\/p>\n
\u2022 CCA uses only a portion of the first floor and all of the second floor for administrative offices and teacher workstations for remote instruction. Part of the first floor and the entire third floor are leased out, or are available for lease to commercial tenants unrelated to CCA\u2019s mission.<\/p>\n
\u2022 The suit\u2019s three counts claim the property is not totally exempt and not exclusively used for CCA\u2019s charitable purpose, and CCA does not qualify as a purely public charity.<\/p>\n
\u2022 A CCA trustee board summary of the building dated May 13, 2026, said the building remained under development with occupancy expected in summer 2026. The tax appeals board erred in granting a full tax exemption because the building is not \u201coccupied and used\u201d for charter school purposes. \u201cAt a minimum, the portions of the property leased or available for lease to commercial tenants are not exempt and must be assessed and taxed at fair market value.\u201d<\/p>\n
\u2022 CCA is funded entirely through per-pupil tuition payments funded by mandatory public appropriations of taxpayer dollars, and not by voluntary charitable giving. \u201cCCA does not operate entirely free from private profit motive\u201d under the meaning of applicable law. The school district\u2019s appeal lawsuit aims \u201cto determine whether CCA\u2019s compensation arrangements for officers and key employees, vendor contracts, management agreements and related-party transactions are consistent with an institution operating entirely free from private profit motive,\u201d and whether its compensation arrangements are \u201ckeyed to financial performance or payments to insiders or affiliated entities inconsistent with the private profit motive prohibition.\u201d<\/p>\n
\u2022 The tax board also erred in not analyzing and determining whether CCA met all requirements of being a purely public charity. The school district\u2019s appeal asks for a court to determine if CCA satisfies the five-pronged purely public charity test, called a HUP test after an acroynm from the case that spawned it, and to assess the property at its full fair market value and subject it to real estate taxation.<\/p>\n
In statement to The Times-Tribune on Wednesday, Timothy Eller, Commonwealth Charter\u2019s chief branding and government relations officer, said: \u201cCCA has not been served with the appeal and does not normally comment on pending or anticipated litigation. However, we feel compelled to provide a brief response in light of the frivolous nature of this matter. The Lackawanna County Board of Assessment Appeals properly granted CCA\u2019s request for tax exemption on the subject property. By law and by operation, CCA is a public school and a non-profit entity and is legally entitled to tax-exempt status. Scranton School District\u2019s allegations of for-profit motive or operations are baseless, and we intend to defend against them vigorously and seek appropriate sanctions, including attorneys\u2019 fees and costs that must now be borne by CCA unnecessarily. The district\u2019s allegations of use of portions of the property for lease to for-profit entities are based on the status of the property in 2022 \u2013 four years ago \u2013 and are incorrect and demonstrate a complete lack of proper investigation by the district of the current status of the property. CCA will respond formally through the appropriate legal process, and we are confident the facts will demonstrate that the district\u2019s claims are meritless.\u201d<\/p>\n
The lawsuit did not say how much tax revenue the district lost from the exemption, or might gain from a reversal. At the time of the building purchase in late 2022, the Scranton School District received about $240,000 in property taxes from the parcel yearly, while the Riverside School District received $38,000, according to archives of The Times-Tribune.<\/p>\n
Along with the $17.8 million purchase of the Cigna building, a renovation project was expected to cost no more than $28 million, according to a legal notice published in 2024 in The Times-Tribune announcing the opening of construction bids for the site.<\/p>\n
CCA is the largest cyber charter school in the commonwealth and second largest school entity after the Philadelphia School District. According to its website, CCA has locations in Allentown, Andreas, Blue Bell, Carlisle, Cranberry, Dickson City, Erie, Harrisburg, Johnstown, Malvern, Mansfield, Mount Pocono, Pittsburgh, Reading, Shippensburg, Scranton, State College, Wilkes-Barre, Williamsport and York; and future sites coming in Bethlehem, DuBois, Lewisburg, Monongahela and Oil City. A Norristown site was closed and had operations move to Blue Bell.<\/p>\n
CCA touts itself as the foremost option for cyber education in the state.<\/p>\n
\u201cFor parents in Pittsburgh, Harrisburg, Philadelphia, and the rest of Pennsylvania, CCA is the leading choice for their children\u2019s cyber school needs,\u201d the website says. \u201cCCA operates more than a dozen\u00a0Family Service Centers across Pennsylvania\u00a0that serve as resources for students and their families. CCA teachers conduct virtual classes from the Family Service Centers, and families can stop by for in-person help with enrollment and meetings with administrators and guidance counselors, or to use any of our extensive services. Our service centers host open house sessions for potential families to learn what online schooling is like, along with field trips and other engaging events.\u201d<\/p>\n
In November, the state implemented various cyber-charter reforms in the 2025-26 state school code adopted at the same time as the state budget. Formally titled Act 47 of 2025, the school code includes new regulations on cyber-charter operations and refigures the cyber-charter tuition formula, with the result being a reduction by tens of millions of dollars in tuition school districts pay to cyber charter schools.<\/p>\n
Efforts to reach the appeals board were unsuccessful.<\/p>\n
<\/p>\n
On-going construction at Commonwealth Charter Academy\u2019s new building on Montage Mountain in Moosic on Thursday, Aug. 14, 2025. (REBECCA PARTICKA\/STAFF PHOTOGRAPHER)\n<\/p>\n
![\"On-going](\"https:\/\/www.thetimes-tribune.com\/wp-content\/uploads\/2026\/07\/STT-L-CignaBuilding-081425-02.jpg?w=620\")
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On-going construction at Commonwealth Charter Academy\u2019s new building on Montage Mountain in Moosic on Thursday, Aug. 14, 2025. (REBECCA PARTICKA\/STAFF PHOTOGRAPHER)\n<\/p>\n
![\"On-going](\"https:\/\/www.thetimes-tribune.com\/wp-content\/uploads\/2026\/07\/STT-L-CignaBuilding-081425-03.jpg?w=620\")
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On-going construction at Commonwealth Charter Academy\u2019s new building on Montage Mountain in Moosic on Thursday, Aug. 14, 2025. (REBECCA PARTICKA\/STAFF PHOTOGRAPHER)\n<\/p>\n
![\"Commonwealth](\"https:\/\/www.thetimes-tribune.com\/wp-content\/uploads\/2026\/07\/STT-L-COMMONWEALTHCHARTER-01.jpg?w=620\")
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Commonwealth Charter Academy\u2019s new building on Montage Mountain in Scranton and Moosic is under construction Monday, Aug. 11, 2025. The school is anticipating the new building will open in mid-2026. (Christine Lee\/Staff Photo)\n<\/p>\n
![\"Commonwealth](\"https:\/\/www.thetimes-tribune.com\/wp-content\/uploads\/2026\/07\/STT-L-COMMONWEALTHCHARTER-02.jpg?w=620\")
<\/p>\n
Commonwealth Charter Academy\u2019s new building on Montage Mountain in Scranton and Moosic is under construction Monday, Aug. 11, 2025. The school is anticipating the new building will open in mid-2026. (Christine Lee\/Staff Photo)\n<\/p>\n
![\"The](\"https:\/\/www.thetimes-tribune.com\/wp-content\/uploads\/2026\/07\/STT-L-CHARTER-0723.jpg?w=620\")
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The Commonwealth Charter Academy building at 53 Glenmaura National Boulevard on Montage Mountain in Scranton on Feb. 6, 2024. (JIM LOCKWOOD \/ STAFF PHOTO)\n<\/p>\n
![\"The](\"https:\/\/www.thetimes-tribune.com\/wp-content\/uploads\/2026\/07\/STT-L-CHARTER-0723_2.jpg?w=620\")
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The Cigna commercial building at 53 Glenmaura National Boulevard on Montage Mountain in Scranton on Nov. 2, 2022. The sign says occupants also included Harper Collins Publishers and Pharma Source, and had other space available. Commonwealth Charter Academy bought the building around mid-December of 2022. (JIM LOCKWOOD \/ STAFF PHOTO\n<\/p>\n
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On-going construction at Commonwealth Charter Academy\u2019s new building on Montage Mountain in Moosic on Thursday, Aug. 14, 2025. (REBECCA PARTICKA\/STAFF PHOTOGRAPHER)\n<\/p>\n