Ruling On I-LEAD Charter School's Tax-Exempt Status

Docket # 14-20605
Plaintiff Attorney(s): =E= Nicole Plank 90421
Plaintiff Attorney(s): =M= David Castro 47082: 115 Petrie Ave Rosemont PA 190101510
Defendant Attorney(s): =M= Patricia Hassinger 66736
Other Attorney(s): =E= Alicia Luke 311306
Other Attorney(s): =M= Anna Ferguson 90308
Other Attorney(s): =E= John Miravich 56124
Other Attorney(s): =M= David Hussey 314814
Other Attorney(s): =E= David Annecharico 91122
Other Attorney(s): =E= Joan London 67934
Received County of Berks Prothonotary’s Office on 04/11/2019 8:41 AM Docket No. 14-20605
INSTITUTE OF LEADERSHIP, : IN THE COURT OF COMMON PLEAS OF
EDUCATION, ADVANCEMENT & : BERKS COUNTY, PENNSYLVANIA
DEVELOPMENT, INC., : CIVIL DIVISION
Petitioner, :
: NO. 14-20605
:
v. :
:
BERKS COUNTY BOARD OF :
ASSESSMENT APPEALS, :
Respondent, :
:
And :
:
READING SCHOOL DISTRICT and :
READING DOWNTOWN :
IMPROVEMENT DISTRICT :
:
AUTHORITY, : ASSIGNED: MADELYN S. FUDEMAN, J.
Intervenors.
Nicole Plank, Esq., Attorney for Petitioner

Patricia Cotter Hassinger, Esq., Attorney for Respondent
John J. Miravich, Esq., and Alicia S. Luke., Attorneys for Intervenor Reading School District
Joan E. London, Esq., Attorney for Intervenor Reading Downtown Improvement District
Opinion and Order, Madelyn S. Fudeman, J._________ April 10, 2019
Procedural History
The Institute of Leadership, Education, Advancement & Development, Inc., (“I-LEAD”),
is a 501(c)(3) nonprofit corporation and owner of a lot comprising of approximately 1.25 acres,
improved with a 260,000 square-foot six-story building located at 401 Penn Street in the City of
Reading (“Property”). The Property was acquired on September 30, 2013, by I-LEAD through a
donative deed and agreement with Continental Assurance Company (“CNA”). I-LEAD leases
the building to I-LEAD Charter School-Reading, Inc. (“Charter School”). The building is leased
by I-LEAD to Charter School for use in association with its operation of a charter school.
1
Shortly after assuming title to the Property, I-LEAD filed an Application for Exemption of Real
Estate to the Berks County Board of Assessment Appeals. A hearing was held by the Board on
October 1, 2014, and on October 8, 2014, the Board issued its decision denying the application.
A timely appeal from the Board’s denial of the application was taken to this court by I-LEAD.
Both the Reading School District (“School District”) and the Reading Downtown Improvement
District (“Improvement District”) were permitted to intervene. On March 15, 2017, and February
6, 2017, I-LEAD and the School District, respectively, filed cross motions for summary
judgment. This Court denied both motions based on its determination that there were substantial
and potentially dispositive issues of material fact in dispute which could obviate the necessity for
deciding the constitutional challenges advanced by the School District. I-LEAD did not appeal
from denial of its motion for summary judgment, but the School District sought and obtained
permission for an interlocutory appeal from this court’s denial of its motion for summary
judgment.
This Court denied the cross motions for summary judgment based upon the determination
that there remained unsettled questions of fact requiring resolution to determine whether the
constitutional challenges should be reached and addressed. The unresolved factual questions
were identified as: 1) I-LEAD’s charitable purposes and its own activities in the building; 2) the
extent of Charter School’s use of the building, both in terms of lease provisions and the extent of
its actual occupation of the demised premises; 3) marketing by I-LEAD to potential tenants for
the building and a lease provision providing for the sharing of surplus rental income; 4) the
amount of rent I-LEAD charged Charter School and whether that rent was at or below fair
market rates; and 5) I-LEAD’s claims of depreciation for tax purposes.
2
The denial of the Motion for Summary Judgment was affirmed by Order of the
Commonwealth Court dated May 14, 2018. A three day bench trial was held in December 2018,
following which the parties jointly requested an extension of time until March 8, 2018, to file
their Proposed Findings of Fact, Conclusions of Law and briefs.
Findings of Fact
1. The Appellant is the Institute of Leadership, Education, Advancement & Development, Inc.
(“I-LEAD”) a 501(c)(3) nonprofit organization formed in 1995. Notes of Testimony Bench
Trial vol. 5, Ex. 16, Institute of Leadership, Education, Advancement & Development, Inc., v.
The Board of Assessment Appeals of Berks County and Reading School District and Reading
Downtown Improvement District, No. 14-20605. (“Trial Tr.”)
2. I-LEAD was organized in 1995 to:
1) provide formal education and instruction regarding leadership disciplines and

leadership skills through a regular faculty and curriculum, to a regularly enrolled
body of students, on a regular basis; 2) to improve human welfare through the
education, advancement, and development of community leaders; 3) to study
leadership and promote leadership development through experiential and
collaborative learning techniques; 4) to develop educational resources for the
study and development of leadership; 5) to improve the law, the legal system, and
the administration of justice; and 6) to engage in any lawful act or activity for
which nonprofit corporations may be organized under the Pennsylvania Nonprofit
Corporation Law of 1998.
Trial Tr. vol. 5, Ex. 16, at 3.
3. The subjects of I-LEAD's charity are the youth and families that I-LEAD engages
with in helping them to attain secondary education credentials and the low income
adults that I-LEAD serves in helping them develop their leadership skills and helping
them achieve a college education. Trial Tr. vol. 1, 88:4-8.
3
4. There is no financial litmus test for receiving I-LEAD’s services. Trial Tr. vol. 1,
89:12.
5. I-LEAD’s fiscal year is July 1st through June 30th. Trial Tr. vol. 2, 353:4-5.
6. The Appellee is the Berks County Board of Assessment Appeals (“Board”), with an
office in the Berks County Services Center, 633 Court Street, Reading, Berks
County, Pennsylvania 19601.
7. The Reading School District (“School District”) is an Intervenor, with an address
located at 800 Washington Street, Reading, Berks County, Pennsylvania, 19601.
8. The Reading Downtown Improvement District (“Improvement District”) is also an
Intervenor, with an address located at 645 Penn Street, Suite 200, Reading, Berks
County, Pennsylvania, 19601.
9. After acquiring title, I-LEAD, Inc. filed an Application for Exemption of Real Estate
(the “Application”) with the Board. Trial Tr. vol. 3, Ex. 1, at 2-3.
10. On October 8, 2014, following a hearing, the Board issued a Final Notice denying the
Application. Trial Tr. vol. 3, Ex. 1, at 14.
11. On October 22, 2014, I-LEAD, Inc. appealed Board’s decision to the Berks County
Court of Common Pleas. Trial Tr. vol. 3, Ex. 1, at 8-14.
12. The dispute before this Court concerns a tax exemption appeal for I-LEAD’s property
located at 410 Penn Street, Reading, Berks County, Pennsylvania (the “Property”)
Trial Tr. vol. 3, Ex. 1.
13. The Property includes a 260,000 square-foot building situate on a 1.25-acre lot
located within the geographical boundaries of the Reading School District. Trial Tr.
vol. 2, 490:14-17; Ex. 1.
4
14. The building consists of six floors: 1) lower level; 2) first floor; 3) second floor; 4)
third floor; 5) fourth floor; and 6) fifth floor. Trial Tr. vol. 2, 490:19-20.
15. As of 2015, the Property’s tax assessed value was $9,663,900.00. Trial Tr. vol. 1, Ex.
1, at 14.
16. I-LEAD became the owner of the Property on September 30, 2013, via a Donative
Agreement with Continental Assurance Company (“CNA”). Trial Tr. vol. 3, Ex. 2.
17. Pursuant to the Donative Agreement, CNA agreed to convey the Donated Property to
I-LEAD as a charitable contribution to I-LEAD, and I-LEAD agreed to accept the
Donated Property to be utilized in connection with its charitable purposes. Trial Tr.
vol. 3, Ex. 2, at 1.
18. I-LEAD accepted the donation of the Property, subsequently leasing the Property to I-
LEAD Charter School-Reading (“Charter School”), a separate 501(c)(3) nonprofit
organization formed in 2010. Trial Tr. vol. 3, Ex. 2, at 1.
19. I-LEAD’s CEO and President, David Castro, testified that his understanding behind
the reason for donating the Property to I-LEAD was due to a concern that School
District could at some point revoke Charter School’s charter and own the building.
Trial Tr. vol. 1, 281:4.
20. In order to acquire the Property, I-LEAD took out a loan to pay for the transfer tax.
Trial Tr. vol. 1, 75:16-24.
21. The transfer tax was more than $600,000.00. Trial Tr. vol. 1, 84:7-8.
22. In September 2013, I-LEAD entered into an unsecured note agreement with VIST
Bank in the amount of $700,000.00. Trial Tr. vol. 4, Ex. 8, at 35, Note 4.
5
23. This note was paid off in June 2015, when I-LEAD entered into a secured note
agreement with Santander Bank in the amount of $670,000.00. Id.
24. Amounts outstanding against the note are secured by all assets of I-LEAD. Id.
25. Charter School’s students began attending classes at the Property for the 2014-2015
academic year, beginning in the Fall of 2014. Trial Tr. vol. 6, Ex. 20, at 30,
deposition page 109:17-19.
26. On July 21, 2014, Charter School was given a Certificate of Occupancy for the lower
level and ground floors. Trial Tr. vol. 3, Ex. 6, at 2.
27. Consistent with the Certificate of Occupancy, for the 2014-2015 academic year,
student classes only occurred on the lower level and first floor of Charter School; no
student classes occurred on the second, third, fourth or fifth floors of the building.
Trial Tr. vol. 2, 492:24-493:4.
28. On March 3, 2015, Charter School was given a Certificate of Occupancy for the
lower level, first, and second floors. Trial Tr. vol. 3, Ex. 6, at 3.
29. For the 2015-2016 academic year, student classes occurred only on the lower level,
first and second floors of the building; no student classes occurred on the third,
fourth, or fifth floors. Trial Tr. vol. 2, 494:7-17.
30. Charter School does not conduct classes on all floors; there are no classrooms on the
third floor, fourth floor, or fifth floor. Trial Tr. vol. 2, 494:18-495:2; 495:25-496:12;
497:8-9.
31. Only Charter School employees provide services to Charter School students at the
Property. Trial Tr. vol. 6, Ex. 20, at 24, deposition page 86:21-87:9.
6
LEASE AGREEMENTS BETWEEN I-LEAD AND CHARTER SCHOOL
32. After obtaining title the Property, I-LEAD and CNA entered into a lease agreement in which
I-LEAD leased twenty-two percent of the Property back to CNA from the date of the
Donative Agreement until May 31, 2014. Trial Tr. vol. 3, Ex. 4 at 1-16; 18.
33. The purpose of this lease was to allow CNA to move out of the property. Trial Tr. vol. 1,
76:16-20.
34. On October 2, 2013, I-LEAD entered into a lease with Charter School for all of the Property
not leased to CNA. Trial Tr. vol. 3, Ex 4. at 17; 19-66.
35. This lease provides termination to occur upon such a date as the parties shall negotiate
another lease or terminate the lease. Trial Tr. vol. 3, Ex. 4 at 17.
36. Six months later, March 25, 2014, I-LEAD and Charter School entered into a new lease
agreement for the term of April 1, 2014 through June 30, 2015. Trial Tr. vol. 3, Ex. 4 at 19-
34.
37. Pursuant to this lease, Charter School was required to pay I-LEAD monthly rent equal to the
operating expenses incurred by I-LEAD but not to exceed $390,000.00 per year. Trial Tr.
vol. 3, Ex. 4, at 22, 34.
38. A week later, April 1, 2014, I-LEAD and Charter School entered into a new lease for the
Property to commence on April 1, 2014, through June 30, 2015, with automatic twelve
month renewals. Trial Tr. vol. 3, Ex. 4, at 35-49.
39. The rent provisions in the April 1, 2014, lease were adjusted as follows: 1) $0.00 from April
1, 2014, through July 31, 2014; 2) $33,307.80 per month from August 1, 2014, through
January 31, 2015; 3) $40,225.05 per month from February 1, 2015, through June 30, 2016;
and 4) $44,247.50 per month after July 1, 2016. Trial Tr. vol. 3, Ex. 4, at 48.
7
40. In September 2018, I-LEAD and Charter School executed a new lease. Pursuant to the new
lease, Charter School pays $44,247.50 per month which equates to $530,970.00 per year.
Trial Tr. vol. 3, Ex. 4, at 64.
41. The terms regarding access in the September 2018 lease were altered, compared to the
previous leases, so that while both I-LEAD and Charter School were still both granted
unfettered access to the Property, I-LEAD was permitted to use the premises consistent with
or in support of Charter School’s use of the Property. Trial Tr. vol. 3, Ex. 4, at 52.
42. Additionally, part of Charter School’s rent payments includes interest on the loan I-LEAD
took out to pay for the more than $600,000.00 transfer tax. Trial Tr. vol. 1, 75:21-76:2.
43. Another change to the September 2018 lease, in comparison to the previous leases, is that the
September 2018 lease required Charter School to pay “additional rent to cover the annual
operating expenses related to occupancy of the premises.” Trial Tr. vol. 3, Ex. 4, at 65.
44. In all of the leases between I-LEAD and Charter School, any rental payments in excess of the
operating and maintenance costs were to be paid back to Charter School as an unrestricted
charitable contribution. Trial Tr. vol. 3, Ex. 4, at 65.
45. At no point during the trial did I-LEAD present any evidence or calculations with respect to
the breakdown of what portions, if any, of the rent paid is for utilities, maintenance and/or
operating costs.
46. To the contrary, there was extremely convoluted testimony from Barbara Sykes, CFO of
Charter School and I-LEAD, who characterized the financial aspects of building operations,
maintenance and utilities as “clear as mud”, but concluded that Charter School pays for
utilities and has its own janitorial staff and a director of facilities management which take
care of much of the repair and maintenance of the building. Trial Tr. Vol. 2, 425:5-25.
8
47. Pursuant to the lease, I-LEAD and Charter School both have the ability to access and use the
entire Property. Trial Tr. vol. 1, 84:1-4.
48. Despite the lease with Charter School, I-LEAD allows other entities to use space in the
Property. These entities are: 1) Community First Fund, a public charity that provides banking
services to non-profits and to small businesses in the community; 2) The Hispanic Dental
Association; and 3) Lamega, a digital media company that utilizes the Property to collaborate
with Charter School on digital media programming. Trial Tr. vol. 1, 85-87.
49. These entities do not have lease agreements with I-LEAD or Charter School. Trial Tr. vol. 2,
396:12-23.
50. None of these entities pay rent nor do they pay for any utilities or maintenance Trial Tr. vol.
1, 85:4-88:2.
51. Charter School receives tuition payments from each of the school districts whose students
attend Charter School. Trial Tr. vol. 2, 576:6-9.
52. Between July 2013, and November 2018, Charter School has received $25,957,913.15 (Trial
Tr. vol. 4, Ex. 11), has received federal funding to operate the school including Title I, II and
III funding, (Trial Tr. vol. 2, 577:17-578:2) and seeks lease reimbursements from the
government. Trial Tr. vol. 1, 82:19-23.
53. Charter School represents to the Pennsylvania Department of Education (“PDE”) that it
leases the entirety of the Property when it seeks reimbursement from PDE for its lease
payments. Trial Tr. vol. 4, Ex. 9.
54. For the 2014-2015 school year, Charter School reported $400,971.70 in reimbursable lease
costs to the PDE. Trial Tr. vol. 4, Ex. 9 at 1-5.
9
57. Without the lease arrangement between I-LEAD. and Charter School, Charter School could
not receive a lease reimbursement payment from PDE. Trial Tr. vol. 2, 417:12-16.
I-LEAD’s USE OF THE PROPERTY
58. I-LEAD has unfettered access to the Property, but it uses only a
very small portion of the 260,000 square foot building for their Achieve College Education
(“ACE”) program1. Trial Tr. vol. 1, 143:15-146:13.
59. There is one I-LEAD employee working at the Property. Trial Tr. vol. 2, 599:4-8
60. That employee’s office is approximately 100 square feet. Trial Tr. vol. 1, 143:15-23.
61. I-LEAD’s usage of the Property for the ACE program consists of a storefront office and the
use of a few classrooms two nights a week when class is in session. Trial Tr. vol. 6, Ex. 22,
at 18, deposition page 28:10-29:25.
62. As of the date of trial there was only one student enrolled. David Castro, I-LEAD’s CEO and
President, testified, “what happened was we had a larger cohort of students there at that site
and then what happened is they slowly graduated. And there was one left.” Trial Tr. vol. 1,
132:3-6.
63. With respect to I-LEAD’s use of the Property, David Castro testified about I-LEAD’s
presence at the Property:
Q: [O]ther than an office that might be maintained by Mr. Atkins2 and space that
is available for use by the ACE program, I-LEAD, Inc. does not occupy the
1
The ACE program will be discussed further infra.
10
premises, correct?
A: I-LEAD does not have any – to my knowledge, beyond the ACE program, I-
LEAD staff does not maintain any offices in the building.
Q: That’s pursuant – the lease agreement – I don’t know what the amended
version
says. But the one that I have introduced here demises the entire premises as a
leased premises to I-LEAD Charter School, correct?
A: That is correct. We do have, under the lease, the rights as the owner to use
the premises. But we don’t. We let the charter school use it exclusively.
Trial Tr. vol. 6, Ex. 20, at 41, deposition page 154:6-22.
64. At trial, Angel Figueroa, CEO and COO of Charter School, testified that I-LEAD employees
do not regularly use the Property. Trial Tr. vol. 2, 599: 21-600:5.
ACHIEVE COLLEGE EDUCATION (“ACE”) PROGRAM
65. The stated purpose of the ACE program is to help low income people access higher
education. Trial Tr. vol. 1, 92:13-15.
66. David Castro testified at his 2016 deposition that ACE is I-LEAD’s “main program service”
and “major program initiative.” “It’s what we do. That makes up a good 90 percent of what
we do.” Trial Tr. vol. 6, Ex. 20, at 13, deposition page 42:17 to page 43:7.
67. ACE accepts anyone that is interested into the program; there is no means test in order to
gain acceptance. Trial Tr. vol. 2, 331:21-23.
68. Through the ACE program, I-LEAD sends community education advocates into low-income
communities. Trial Tr. vol. 1, 92:10-18.
69. These advocates conduct presentations about the power of achieving a college degree, how to
overcome barriers, and how to obtain scholarships and grants to pay for college tuition. Trial
Tr. vol. 1, 93:1-7.
2
Mr. Atkins is Mr. Torres’ predecessor. Trial Tr. vol. 1, 322:13-15.
11
70. Harcum College (“Harcum”) has a revenue sharing agreement with I-LEAD whereby I-
LEAD receives forty percent of all payments to Harcum for students referred to Harcum by
I-LEAD. Trial Tr. vol. 1, 110:3-7.
71. The forty percent revenue sharing agreement for students recruited to Harcum by I-LEAD,
includes “federal aid and cash payments received by Harcum.” Trial Tr. vol. 5, Ex. 18, at 37;
75; 122.
72. Harcum’s Vice President of Academic Affairs is married to David Castro. Trial Tr. vol. 1,
112:9-12.
73. According to Harcum’s Form 990 tax filing, Harcum paid I-LEAD a total of $2,305,056 for
students I-LEAD recruited for July 1, 2014-June 30, 2015. Trial Tr. vol. 5, Ex. 18 at 37.
students I-LEAD, Inc. recruited for July 1, 2015-June 30, 2016. Trial Tr. vol. 5, Ex. 18, at 75.
students I-LEAD recruited for July 1, 2016-June 30, 2017. Trial Tr. vol. 5, Ex. 18, at 122.
76. I-LEAD, Inc. has a 50% interest in Aprendizaje Superior para la Communidad LLC
(“ASC”), a limited liability company involved with the ACE Program, and I-LEAD receives
funding from Harcum for that entity, too. Trial Tr. vol. 1, 124:18-125:24.
77. According to Harcum’s Form 990 tax filing, Harcum paid ASC a total of $417,270 for July
1, 2014-June 30, 2015. Trial Tr. vol. 5, Ex. 18, at 37.
1, 2015-June 30, 2016. Id. at 75.
1, 2016-June 30, 2017. Id. at 122.
12
RENTAL VALUE OF PROPERTY
80. I-LEAD offered testimony from John Buccinno regarding fair market rental value. Trial Tr.
vol. 7, Ex. 25.
81. By stipulation of counsel, Mr. Buccinno’s testimony was limited to the contents of his report.
Trial Tr. vol. 7, Ex. 41.
82. Mr. Buccinno’s report never links his overall conclusion regarding rental value in the city of
Reading generally to the Property, and never concludes whether the Property is being rented
at or below fair market value. Trial Tr. vol. 7, Ex. 25; vol. 1, 539:4-10.
83. Mr. Buccinno testified that had he been directed to offer an opinion as to the fair market
rental value of the Property, he “absolutely” would have needed to consider other factors he
did not consider in his report. Trial Tr. vol. 2, 546:11-15
84. Mr. Buccinno further testified that he, “would have requested additional information” to offer
an opinion as to the fair market rental value for the Property. Trial Tr. vol. 2, 550:8-12.
85. School District offered the report of Joseph Vizza to rebut the report and testimony offered
by Mr. Buccinno. Trial Tr. vol. 7, Ex. 26.
86. Mr. Vizza found that Mr. Buccinno’s report did not fully adhere to what a fair market rental
value analysis should have included. Trial Tr. vol. 2, 557:22.
87. Mr. Vizza further testified that he felt that there were certain things missing from the report
that would lead him to believe that the range of rental rates Mr. Buccinno provided lacked
credibility. Trial Tr. vol. 2, 558:6-11.
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SALARIES AND BONUSES
88. For the fiscal year of July 1, 2014 through June 30, 2015, David Castro earned $166,216,
including a salary of $149,231 from I-LEAD and an additional $16,985 from related
organizations. Trial Tr. vol. 3, Ex. 7, at 74.
organizations. Id. at 112.
organizations. Id. at 151.
91. For 2017-2018, Mr. Castro’s salary was $195,000.02. Trial Tr. vol. 2, 236:5-7.
92. For tax year July 1, 2014, through June 30, 2015, Angel Figueroa earned from Charter
School and related organizations approximately $160,000.00 Trial Tr. vol. 4, Ex. 14 at 7.
93. For tax year July 1, 2015, through June 30, 2016, Angel Figueroa earned from Charter
School and related organizations approximately $149,162.00. Id. at 45.
94. For the tax year July 1, 2016, through June 30, 2017, Angel Figueroa earned from Charter
School and related organizations approximately $240,048.00. Id. at 89.
95. Angel Figueroa’s salary is paid by Charter School but his benefits are covered by I-LEAD,
Trial Tr. vol. 2, 597:3-4.
Analysis
Under Pennsylvania law, there are two ways for a property owner to be relieved from the
obligation to pay property tax: immunity and exemption. Immunity, available only to
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instrumentalities of the Commonwealth, is not raised in the instant case and will therefore not be
discussed.
Article VII, Section 2(a)(v) of the Pennsylvania Constitution states, “[t]he General
Assembly may by law exempt from taxation: [i]nstitutions of purely public charity, but in the
case of any real property tax exemptions only that portion of real property of such institution
which is actually and regularly used for the purposes of the institution.” Pa. Const. art. VIII, §
2(a)(v). An institution seeking a real estate tax exemption bears a heavy burden of establishing
its entitlement to such an exemption. Camp Hachshara Moshava of New York v. Wayne Cty. Bd.
for Assessment & Revision of Taxes, 47 A.3d 1271, 1275 (Pa. Commw. Ct. 2012). To establish
the status of purely public charity for the purpose of obtaining exemption from real estate taxes,
an institution must first satisfy all five prongs under the analysis crafted by the Pennsylvania
Supreme Court, commonly known as the “HUP test”. (See Hospital Utilization Project v.
Commonwealth, 487 A.2d 1306 (Pa. 1985)). Second, the entity must satisfy the statutory test set
forth in the Institutions of Purely Public Charity Act, Act of November 26, 1997, P.L. 508, 10
P.S. §§371-385. See Mesivtah Eitz Chaim of Bobov, Inc. v. Pike County Bd. of Assessment
Appeals, 44 A.3d 3 (Pa. 2012).
I-LEAD argues that it not only qualifies for exemption as an institution of purely public
charity, but that it is exempt under Chapter 24 P.S. Section 17-1722-A (e)(1) which provides:
“Notwithstanding the provisions of section 204 of the act of May 22, 1933 (P.L.
853, No. 155), known as the General County Assessment Law, all school
property, real and personal, owned by any charter school, cyber charter school or
an associated nonprofit foundation, or owned by a nonprofit corporation or
nonprofit foundation and leased to a charter school or associated nonprofit
foundation at or below fair market value, that is occupied and used by any charter
school or cyber charter school for public school, recreation, or any other purpose
provided for by this act, shall be made exempt from every State, county, city,
15
borough, township or other real estate tax, including payments in lieu of taxes
established through agreement with the Commonwealth or any local taxing
authority, as well as from all costs or expenses for paving, curbing, sidewalks,
sewers or other municipal improvements, provided that any charter school or
cyber charter school or owner of property leased to a charter school or cyber
charter school may make a municipal improvement in a street on which its school
property abuts or may contribute a sum towards the cost of the improvement.”
The Board, School District and Improvement District all challenge the constitutionality of
this statute which exempts from real estate tax any property owned by a charter school or leased
by a nonprofit corporation or foundation to a charter school, as violative of the uniformity of tax
mandate under the Pennsylvania Constitution. In the instant case, we need not reach the
constitutional questions because the case is susceptible to non-constitutional disposition by
application of law to the facts established at trial. It is axiomatic that constitutionality questions
should be avoided where a matter can be decided on alternative, non-constitutional grounds.
When the constitutionality of a statute is raised, a reviewing court should first look to construe
the statute in a way that avoids the constitutional question. Boettger v. Loverro, 587 A.2d 712 at
716.
The requirements for qualification for exemption under Section 1722-A(e)(1) are clear
and require no application of statutory interpretation beyond plain meaning. Both Appellant, I-
LEAD, and Charter School are entities contemplated by the statute to qualify for exemption; I-
LEAD is a non-profit corporation leasing the Property to Charter School for operation of a
charter school. However, in the case of an otherwise qualified entity leasing to a charter school,
the statute further requires that the rent paid be at or below fair market value. It is with regard to
this requirement that I-LEAD failed to meet its burden of proof, thereby rendering itself
ineligible for relief under Section 1722-A(e)(1) and eliminating the need to address the
16
constitutional challenges. The testimony of I-LEAD’s expert witness, John Buccinno, regarding
the fair market rental rate for the Property was unequivocal in that he was not instructed to, nor
did he attempt to, analyze the fair market rental value of the Property. Trial Tr. vol. 2, 539:4-25.
Rather, Mr. Buccinno testified that he had been instructed only to “establish the fair market
rental value for the downtown Reading. So, it was more of a generalized ask that I was—which
was what I tailored the report towards.” Trial Tr. vol. 2, 540:7-10. Perhaps most determinative
on this issue is Mr. Buccinno’s testimony in response to a question from the court: “Q: Mr.
Buccinno, had you been directed to offer an opinion as to the fair market rental value of this
particular property, are there things you would have considered that you did not consider in this
report? A: Absolutely.” Trial Tr. vol. 2, 546:11-15. Further, when asked by the court “Q: Did
you have all the information you would need to offer an opinion as to the fair market rental value
for this property for 401 Penn? A: I would have requested additional information.” Trial Tr. vol.
2, 550:8 -12.
I-LEAD further failed to meet the burden of proof necessary to establish its eligibility for
exemption as a purely public charity because it could not satisfy the unity of ownership and use
element which is a fundamental and preliminary requirement to be met by any entity seeking
exemption as an institution of purely public charity. Before application of the 5-step HUP test or
application of the criteria under Act 55, it must be established that the entity seeking exemption
owns the property and operates the charitable activity on the property for which the exemption is
sought. “The entity seeking exemption must be the owner and occupier of the property.” Appeal
of Northwestern Corp. from Dauphin County Bd. of Assessment Appeals, 665 A. 2d 856, at 858
(Pa. Commw. Ct. 1995.) See also Berks Cty. Bd. of Assess. and Revision of Taxes v. Berks Cty.
Conservancy, 517 A.2d 572 (Pa. Commw. Ct.1986) in which Berks County Judge Frederick
17
Edenharter held that there was no need to address the issue of whether the entity seeking
exemption could meet the test to establish itself as an institution of purely public charity because
it could not satisfy the requirements for use and occupancy. Id. at 575.
I-LEAD argues that the facts of this case are “nearly identical” to the facts of Borough of
Homestead v. St. Mary Magdalen Church, 798 A.2d 823 (Pa. Commw. Ct. 2002), this Court
disagrees. In Mary Magdalen, the St. Mary Magdalen Church and the Diocese of Pittsburgh
owned property which had housed a high school operated by the Diocese. Id.at 824. In 1987,
after the closure of a local steel mill that caused 12,000-15,000 people to lose their jobs,
enrollment in the high school dropped and the Diocese closed the school. Id. at 824-825. The
high school was converted into an office where the Diocese operated the Bishop Boyle Job
Center to help displaced workers in the community. Id. The Diocese entered into license
agreements with for-profit and non-profit entities to assist the Diocese in its efforts to help the
unemployed and generate new business for the community. Id. The Diocese maintained a
physical presence at the building as the building administrator and operator of the job center. Id.
The Mary Magdalen court distinguished the case from another case involving the Archdiocese of
Philadelphia where the court concluded that the Archdiocese’s use and occupancy of a property
consisting of parking a bus and storing furniture did not satisfy the owner occupied criteria of a
county assessment law. Id. at 829. “The facts in Archdiocese of Philadelphia, involving minimal,
passive possession, are significantly different from the situation at the Bishop Boyle Center,
where the Diocese maintains active, daily possession with some control over all the activities on
the property. At the Bishop Boyle Center, Licensees are the necessary recipients of the Diocese’s
bounty and active participants in its charitable mission.” Id. The court further found that in Mary
Magdalen, the Diocese did not give up its right to possess or control the property due to the fact
18
the license agreements were reviewed on an annual basis to ensure that each occupant continued
to further the Bishop Boyle Center’s mission in some manner AND the trial court found that the
space was provided to the licensees at below market rates. Id. at 827. [Emphasis added].
There is a clear distinction between the matter before this Court and Mary Magdalen.
Here, I-LEAD leases the entirety of the Property to Charter School thus creating a landlord-
tenant relationship. In Mary Magdalen, the Diocese had license agreements with the for-profit
and non-profit entities. The Diocese did not give up its right to possession and control of the
property like I-LEAD did with leasing the Property to Charter School. Although their lease states
I-LEAD is permitted to use the premises consistent with or in support of Charter School’s use of
the Property, as would be determined by I-LEAD and Charter School (Trial Tr. vol. 3, Ex. 4, at
52), the facts show that I-LEAD does not use the property in the same manner that Diocese did
in Mary Magdalen. Diocese maintained active, daily possession with control over all activities
on the property. Mary Magdalen, at 829. Here, Charter School has its own director of facilities
and janitorial staff. Trial Tr. vol. 2, 421:15-422:6. David Castro testified that I-LEAD conducts
very little business at the Property, consisting primarily of a class associated with the ACE
Program, presently for one student, who is instructed by a teacher who comes to the Property
only to teach that class. David Castro further testified that I-LEAD rents a space in Bryn Mawr,
Pennsylvania to use as a small administrative office. When asked, “do any employees, officers or
directors of I-LEAD work from home offices?” Mr. Castro answered, “[y]es, they do. Trial Tr.
vol. 1, 25:22-26:6. This testimony shows that I-LEAD does not maintain active, daily possession
with control over all activities on the Property. Accordingly, in light of the facts adduced at trial,
this Court disagrees with I-LEAD’s argument that the facts of this case are “nearly identical” to
the facts of Mary Magdalen.
19
I-LEAD argues that it is virtually one and the same as Charter School; however, the
testimony concerning the relationship between the two entities was amorphous at best. With
respect to formation of a legal entity, Justice Saylor wrote, “[o]nce these choices are made, such
persons and entities are not free to blur the lines of the capacity in which they act as it may suit
them, and the courts must take care to maintain the necessary distinctions.” Patton v.
Worthington Assocs., Inc., 89 A.3d 643, 649 (Pa. 2014). I-LEAD CEO and President, David
Castro (Trial Tr. vol. 1, 137:11-12) and Charter School CEO and COO, Angel Figueroa, (Trial
Tr. vol. 2, 594:18-22) both testified that they considered the two entities to be synonymous.
However, factors used to determine corporate relatedness, such as by-laws, directors and
officers, tax returns and finances revealed that while these two entities had some crossover of
work and missions, they are not legally related. The record reflects the following pertinent facts:
1) there are different boards of directors (Trial Tr. vol. 1, 63:7-24) and by-laws (Trial Tr. vol. 4,
Ex. 12; vol. 5, Ex. 16) for each of the entities; 2) I-LEAD, the owner of the Property, only uses a
small portion of the building to conduct classes and business for Harcum College (presently one
student attends), Trial Tr. vol. 1, 143:15-146:13; 3) there is a lease between I-LEAD and Charter
School describing the demised premises as the entire building, Trial Tr. vol. 1, 182:21-183:7; 4)
although I-LEAD leased the Property to Charter School, I-LEAD is afforded access to the entire
building, under the terms of the lease, but utilizes only a portion of the building to operate the
ACE program in conjunction with its agreement with Harcum College, Trial Tr. vol. 1, 143:15-
146:13 5) most of I-LEAD’s business is run from an administrative office near the home of
David Castro in Bryn Mawr, Pennsylvania, not from the Property (Trial Tr. vol. 1, 105:25;
135:20-136:4); 6) I-LEAD took depreciation of the Property on its 2013 through 2016 tax returns
(Trial Tr. vol. 3, Ex. 7; vol. 4, Ex. 8); 7) David Castro’s salary is paid by I-LEAD, Trial Tr. vol.
20
2, 434:3; 435:4; and 8) Angel Figueroa’s salary is paid from Charter School but his benefits are
covered by I-LEAD, Trial Tr. vol. 2, 597:3-4.
Mr. Castro, an attorney, (Trial Tr. vol.1, 140:4-7) testified that I-LEAD and Charter
School are essentially synonymous; however, his testimony in this regard established only a
relationship that defies clear delineation but in no respect supports a sound legal conclusion that
the two entities are essentially one and the same. At trial, David Castro, President, CEO and
founder of I-LEAD, eliminated any doubt as to whether the two entities were considered separate
and distinct when he testified that one important reason for taking title to the Property in the
name of I-LEAD rather than Charter School was to avoid any possibility that the Property might
revert to the Reading School District in the event that the charter were to be revoked. Trial Tr.
vol. 1, 281:4. That clearly connotes knowledge and intention to create a separate and distinct
entity for a desired benefit or protection. There was also testimony that, as a condition of
granting the charter, School District demanded that a separate entity be formed to operate the
charter school because the board members of Charter School would be quasi-public officials.
Trial Tr. vol. 1, 280:14-22. Additionally, there was testimony that School District requested that
I-LEAD affiliated board members resign from the board of Charter School because charter
schools are required to operate independently from management companies or other vendors.
Trial Tr. vol. 1, 62:21-63:4; Ex. 35. These may be well-reasoned considerations that drove the
decision to divide ownership of the Property from operation of the charter school, but they only
reinforce the fact that the two entities are separate and distinct, thereby violating the unity of
ownership and use requirement established by Appeal of Nw. Corp. from Dauphin Cty. Bd. of
Assessment Appeals, 665 A.2d 856, 858 (Pa. Commw. Ct. 1995) “[i]n order to qualify for a real
estate tax exemption, the charitable activity of the entity must occur on the specific property for
21
which the exemption is sought, and the entity must be the owner and occupier of the property”
and Berks Cty. Bd. of Assessment & Revision of Taxes v. Berks Cty. Conservancy, 517 A.2d 572,
574 (Pa. Commw. Ct. 1986), “in order for real property to be declared tax exempt it must be both
owned by an institution of ‘purely public charity’ and ‘actually and regularly used’ [by the
owner] for the charitable purposes of that institution.”
Even if the HUP analysis were not obviated by frustration of the unity of ownership and
use requirement, the trial record contains several references to disturb satisfaction of the HUP
test, particularly the fifth prong; that the entity operate entirely free from a private profit motive.
In HUP, supra, the Pennsylvania Supreme Court found that an entity qualifies as a purely public
charity if it:
(a) Advances a charitable purpose;

(b) Donates or renders gratuitously a substantial portion of its services;
(c) Benefits a substantial and indefinite class of persons who are legitimate
subjects of charity;
(d) Relieves the government of some of its burden; and
(e) Operates entirely free from private profit motive.
Hosp. Utilization Project v. Com., 487 A.2d 1306, 1317 (1985).
The somewhat esoteric criteria of the HUP test appear to be afforded a more liberal
construction by the courts, particularly the first one; whether the entity advances a charitable
purpose. This Court takes guidance from and is persuaded by Pennsylvania State Univ. v. Derry
Twp. Sch. Dist., in which the court noted that “Pennsylvania courts have broadly defined
‘charitable purpose’ as including ‘every gift for a general public use, to be applied, consistent
with existing laws, for the benefit of an indefinite number of persons, and designed to benefit
them from an educational, religious, moral, physical or social standpoint. In its broader meaning
it is understood ‘to refer to something done or given for the benefit of our fellows or the public.’”
22
Pennsylvania State Univ. v. Derry Twp. Sch. Dist., 45 Pa. D. & C.4th 51, 61 (Com. Pl. 2000),
citing Council Rock School District v. G.D.L. Plaza Corporation, 49 A.2d 1298, 1301 (1985),
affirmed, 526 A.2d1173 (Pa. Commw. 1987), citing Hill School Tax Exemption Case, 87 A.2d
259, 262 (Pa. 1952). Further noting that the provision of services to the community at no cost on
a non-discriminatory basis indicates consistency with the Council Rock definition of a charitable
purpose, the court also noted that, while an open admissions policy is not the only criteria used to
determine the existence of a purely public charity, it nevertheless remains a primary factor in
determining whether an entity is advancing a charitable purpose.” Pennsylvania State Univ., at
62. Based on that analysis, I-LEAD might satisfy this prong, however it conducts only one class
at the Property. Charter School would also appear to satisfy this component, but it is not the
owner of the property. The trial record suggests, but fails to establish that a substantial portion of
the services rendered by either I-LEAD or Charter School are donated gratuitously.
David Castro testified that “a majority of our program, outside of the charter school,
consists of our Achieve College Education Program (“ACE”) which is funded, majority, from
revenue that we receive from Harcum College, a public two-year college offering associates
degrees.” Trial Tr. vol. 1, 116:17-21. Mr. Castro further testified that there is a fee-sharing
agreement between I-LEAD and Harcum College pursuant to which I-LEAD received 40% of
the tuition and fees received by Harcum College for each student referred by I-LEAD. Trial Tr.
vol. 1, 122:19-23. In fiscal year 2014-15, Mr. Castro testified, I-LEAD received a little in excess
of $2,300,000 from Harcum College. Trial Tr. vol. 1, 124:11-13. In fiscal year 2015-16, I-LEAD
received just over $2,700,000. Trial Tr. vol. 1, 127:17-20, and $2,600,000 for fiscal year 2016-
17. He testified that his wife is vice president for academic affairs at Harcum College (Trial Tr.
vol. 1, 112:11-12), that he earned a salary of $195,000 from I-LEAD and related organizations
23
(Trial Tr. vol. 1, 236:5-6) which derives millions of dollars each year from Harcum College and
that I-LEAD encourages charter school students to attend Harcum. This encouragement may be
for altruistic purposes related to advancing education, but the 40% commission I-LEAD receives
for each student has an inescapable component of profit motive. In reaching this conclusion this
Court considered the lack of financial evidence to show the extent that the proceeds from
Harcum and other sources are used to advance the charity. I-LEAD has no agreements for
reimbursement with any other college or university and the vast majority of students are referred
to Harcum. Mr. Castro testified that Charter School, but not I-LEAD, was successful in sending
some students to Pennsylvania State University. Trial Tr. vol. 1, 118:25-124:8.
The testimony of David Castro and Angel Figueroa fell far short of establishing Mr.
Castro’s assertion that Charter School operates at a loss and requires a subsidy from I-LEAD,
Charter School pays I-LEAD in excess of over $500,000 in rent. What was established is that the
partnership agreement with Harcum generates in excess of $2,000,000 a year for I-LEAD and
compensation paid to Mr. Castro by I-LEAD and related organizations for the most recent year
exceeded $195,000 and compensation paid to Mr. Figueroa by Charter School and related
organizations exceeded $240,000.
In Pennsylvania State Univ., the Court of Common Pleas of Dauphin County considered
salaries and raises in determining the absence of profit motive. Pennsylvania State Univ. v. Derry
Twp. Sch. Dist., 45 Pa. D. & C.4th 51, 70 (Com. Pl. 2000). In Pennsylvania State Univ., the trial
court found that the board of trustees set the salary for the president but the remainder of the
“executive salaries”, including athletics, are set almost entirely at the discretion of the president.
Id. at 70. The trial court concluded that, “the process involved, coupled with the extremely high
salaries of the university’s top paid individuals, indicates to this court a process more akin to a
24
profit-making institution rather than a truly charitable organization.” Id. The trial court noted that
in 1995 the highest paid employee, before being compensated with a salary, earned at least
$260,000 per year, a sum greater than Penn State’s president who earned $250,008 per year.
In the matter before this Court, there was little evidence or testimony of the process or
rationale used to establish salaries, salary raises or bonuses. David Castro testified that his salary
and subsequent salary raises are determined by the board. Trial Tr. vol. 1, 236:8-15. Mr.
Figueroa testified with respect to bonuses, that his bonus is determined by the board. Trial Tr.
vol. 2, 581:1-583:17. But neither could explain what factors were considered in determining how
much each would receive, there was no evidence to support the high salaries and no examples of
comparable salaries paid. Encouraging underprivileged youth to advance their education and
teaching them leadership skills are certainly laudable endeavors but not necessarily altruistic.
The salaries paid to Mr. Castro and Mr. Figueroa appears more in line with a profit making
institution than a truly charitable organization.
In the case of In Re: St. Margaret Seneca Place v. Bd. of Prop. Assessment Appeals &
Review, Cty. of Allegheny, 640 A.2d 380, 385 (Pa. 1994) a nursing home appealed the denial of
its application for real estate tax exemption. The Allegheny County Court of Common Pleas
Judge granted the exemption and the tax authorities appealed.3 In St. Margaret, Justice Flaherty
wrote for the majority, that in the case of W. Allegheny Hosp. v. Bd. of Prop. Assessment,
Appeals & Review of Allegheny Cty., 455 A.2d 1170 (Pa. 1982) “we implied that payment of
excessive salaries and fringe benefits to corporate officers might evidence a private profit
3
The Commonwealth Court, 145 Pa.Commw. 615, 604 A.2d 1119, reversed the trial court and allocatur was
granted by the Pennsylvania Supreme Court, No. 65 W.D. Appeal Docket 1993, which reversed the Commonwealth
Court and reinstated the exemption granted by the trial court.
25
motive, but held that a surplus reapplied to the maintenance and operation of the facility was not
a private profit.” Id. at 385.
In the instant case, there was no evidence to show that there was a surplus much less that
it was reapplied to the maintenance and operation of the facility. What was clearly established in
the record is that Charter School receives tuition payments from each of the school districts the
students of which attend Charter School. Trial Tr. vol. 2, 576:6-9. The record further reflects
between July 2013 and November 2018, Charter School has received $25,957,913.15, (Trial Tr.
vol. 4, Ex. 11) Charter School received federal funding to operate the school including Title I, II
and III funding (Trial Tr. vol. 2, 577:17-578:2) and Charter School seeks lease reimbursements
from the government. Charter School represents to the Pennsylvania Department of Education
(“PDE”) that it leases the entirety of the Property when it seeks reimbursement from PDE for its
lease payments. Trial Tr. vol. 4, Ex. 9. For the 2014-2015 school year, Charter School reported
$400,971.70 in reimbursable lease costs to the PDE. Trial Tr. vol. 4, Ex. 9 at 1-5. For the 2015-
2016 school year, this amount increased, and Charter School reported $482,701.00 in
reimbursable lease costs to the PDE. Trial Tr. vol. 4, Ex. 9 at 6-9. For the 2016-2017 school
year, the last year that figures were provided, Charter School reported $530,970.00 in
reimbursable lease costs to the PDE. Trial Tr. vol. 4, Ex. 9 at 10-14. But for the lease
arrangement between I-LEAD and Charter School, Charter School could not receive a lease
reimbursement payment from PDE. Trial Tr. vol. 2, 417:12-16.
Based on the foregoing, this Court finds that I-LEAD has not established its eligibility for
an exemption. This Court enters the following Order:
26
INSTITUTE OF LEADERSHIP, : IN THE COURT OF COMMON PLEAS OF
EDUCATION, ADVANCEMENT & : BERKS COUNTY, PENNSYLVANIA
DEVELOPMENT, INC., : CIVIL DIVISION
Petitioner, :
: NO. 14-20605
:
v. :
:
BERKS COUNTY BOARD OF :
ASSESSMENT APPEALS, :
Respondent, :
:
And :
:
READING SCHOOL DISTRICT and :
READING DOWNTOWN :
IMPROVEMENT DISTRICT :
:
AUTHORITY, : ASSIGNED: MADELYN S. FUDEMAN, J.
Intervenors.
ORDER
AND NOW, this 10th day of April 2019, after consideration of the evidence established at
trial and post-trial Findings of Fact, Conclusions of Law and briefs of the parties, it is hereby
ORDERED that the Final Notice of the Berks County Board of Assessment Appeals, denying
the Application for Real Estate Taxation of Appellant, Institute of Leadership, Education,
Advancement & Development, Inc., is AFFIRMED.
BY THE COURT:
_______________________________
MADELYN S. FUDEMAN, JUDGE
27
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Ruling On I-LEAD Charter School's Tax-Exempt Status

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Ruling On I-LEAD Charter School's Tax-Exempt Status

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Docket # 14-20605

Plaintiff Attorney(s): =E= Nicole Plank 90421

Defendant Attorney(s): =M= Patricia Hassinger 66736

Other Attorney(s): =E= Alicia Luke 311306

Other Attorney(s): =M= Anna Ferguson 90308

Other Attorney(s): =E= John Miravich 56124

Other Attorney(s): =M= David Hussey 314814

Other Attorney(s): =E= David Annecharico 91122

Other Attorney(s): =E= Joan London 67934

Nicole Plank, Esq., Attorney for Petitioner

Opinion and Order, Madelyn S. Fudeman, J._________ April 10, 2019

The Institute of Leadership, Education, Advancement & Development, Inc., (“I-LEAD”),

market rates; and 5) I-LEAD’s claims of depreciation for tax purposes.

their Proposed Findings of Fact, Conclusions of Law and briefs.

(“I-LEAD”) a 501(c)(3) nonprofit organization formed in 1995. Notes of Testimony Bench

Downtown Improvement District, No. 14-20605. (“Trial Tr.”)

2. I-LEAD was organized in 1995 to:

1) provide formal education and instruction regarding leadership disciplines and

them achieve a college education. Trial Tr. vol. 1, 88:4-8.

County, Pennsylvania 19601.

7. The Reading School District (“School District”) is an Intervenor, with an address

located at 800 Washington Street, Reading, Berks County, Pennsylvania, 19601.

County, Pennsylvania, 19601.

Application. Trial Tr. vol. 3, Ex. 1, at 14.

Court of Common Pleas. Trial Tr. vol. 3, Ex. 1, at 8-14.

Trial Tr. vol. 3, Ex. 1.

vol. 2, 490:14-17; Ex. 1.

I-LEAD as a charitable contribution to I-LEAD, and I-LEAD agreed to accept the

LEAD Charter School-Reading (“Charter School”), a separate 501(c)(3) nonprofit

organization formed in 2010. Trial Tr. vol. 3, Ex. 2, at 1.

Trial Tr. vol. 1, 281:4.

Trial Tr. vol. 1, 75:16-24.

agreement with Santander Bank in the amount of $670,000.00. Id.

deposition page 109:17-19.

level and ground floors. Trial Tr. vol. 3, Ex. 6, at 2.

Trial Tr. vol. 2, 492:24-493:4.

fourth, or fifth floors. Trial Tr. vol. 2, 494:7-17.

not leased to CNA. Trial Tr. vol. 3, Ex 4. at 17; 19-66.

vol. 3, Ex. 4, at 22, 34.

month renewals. Trial Tr. vol. 3, Ex. 4, at 35-49.

Trial Tr. vol. 3, Ex. 4, at 64.

charitable contribution. Trial Tr. vol. 3, Ex. 4, at 65.

entire Property. Trial Tr. vol. 1, 84:1-4.

attend Charter School. Trial Tr. vol. 2, 576:6-9.

government. Trial Tr. vol. 1, 82:19-23.

payments. Trial Tr. vol. 4, Ex. 9.

costs to the PDE. Trial Tr. vol. 4, Ex. 9 at 1-5.

costs to the PDE. Trial Tr. vol. 4, Ex. 9 at 6-9.

costs to the PDE. Trial Tr. vol. 4, Ex. 9 at 10-14.

I-LEAD’s USE OF THE PROPERTY

(“ACE”) program1. Trial Tr. vol. 1, 143:15-146:13.

at 18, deposition page 28:10-29:25.

presence at the Property:

Trial Tr. vol. 6, Ex. 20, at 41, deposition page 154:6-22.

education. Trial Tr. vol. 1, 92:13-15.

gain acceptance. Trial Tr. vol. 2, 331:21-23.

communities. Trial Tr. vol. 1, 92:10-18.

Tr. vol. 1, 93:1-7.

I-LEAD. Trial Tr. vol. 1, 110:3-7.

1, 2014-June 30, 2015. Trial Tr. vol. 5, Ex. 18, at 37.

1, 2015-June 30, 2016. Id. at 75.

1, 2016-June 30, 2017. Id. at 122.

vol. 7, Ex. 25.

Trial Tr. vol. 7, Ex. 41.

did not consider in his report. Trial Tr. vol. 2, 546:11-15

by Mr. Buccinno. Trial Tr. vol. 7, Ex. 26.