Citing privacy concerns, Pennsylvania Gov. Tom Wolf has been reluctant to say much about why certain businesses were exempted, and others weren’t. Those decisions were made after he ordered one of the nation’s stricter state coronavirus shutdowns in March, permitting only “life-sustaining” employers to stay open.
As Pennsylvania unemployment soared, state records show that 42,219 business owners applied for waivers exempting them from Wolf’s order.
State officials told reporters that waivers were rare, and when on May 8, they finally named those granted, they listed only 6,124 exemptions. That’s an approval rate of less than 15%. One in seven.
But as the state has slowly released more data, it’s become clear that most of the businesses that asked to remain open were in fact allowed to do so.
Besides the 6,000-plus granted exemptions, 11,636 who worried they didn’t qualify as “life-sustaining” were told they actually did. (Life-sustaining companies needed no permission to stay open.) And another 11,645 were allowed to operate because the governor, on reflection, decided that firms from four “special industries” — automotive, construction, law, and golf — could safely open after all. Those businesses’ names were posted on a state web page the week after the exemptions were listed.
That leaves 12,814 applicants denied exemptions — 30% of those applying — including the University of Pennsylvania, the biggest employer in Philadelphia.
So 7 of 10 who asked to stay open were allowed to — a lot better odds than 1 in 7.
Casey Smith, a spokesperson for the Department of Community and Economic Development, which handled the appeals, objected to my math. More than half the applicants “didn’t receive an exemption,” they just “received approval,” she told me.
Which is a distinction that might matter to people doling out information in Harrisburg. But if you were turned down, you’re just as shut -- with bills rising and no income -- and left to wonder why other, sometimes similar-sounding firms were allowed to reopen.
The exemption rate across counties was surprisingly stable. Checking the state’s seven most-populous counties — Philadelphia and its four neighboring counties, plus Lancaster and Allegheny (Pittsburgh) — a steady 13% to 15% of all applicants were granted exemptions.
Rejections varied more —- just 27% in Delaware County, 37% in Lancaster County.
Applicants waived through without official exemptions, of course, account for all the remainder — a majority of those who asked.
The lists, with no further explanation — remember, that’s private! — raise apparent contradictions.
While 99 businesses with “cabinet” in their names were refused waivers, eight other apparent cabinetmakers were approved or told they needed no waivers.
While the Brethren and Community churches in Ephrata were refused exemptions, Baptist churches in Allentown, Ambler, and Gettysburg were told they could operate without exemptions.
Four candy factories or stores were denied exemptions, but 10 were told they could stay open and didn’t need exemptions.
Can the governor do all this? Lawsuits challenging the right of a governor to declare a state of emergency and close businesses have died predictable deaths in Pennsylvania courts, so far.
Jonathan Goldstein, who owns Schulmerich Bells LLC in Hatfield, says he was forced to lay off eight employees as a “nonexempt" bell foundry. He is trying a different approach. He also heads a law firm and is a veteran civil libertarian. And he’s filed a federal lawsuit challenging, not Wolf’s emergency power to shut employers, but the way he did it.
The Fifth Amendment to the U.S. Constitution includes the “takings clause” — that private property cannot “be taken for public use, without just compensation.” The 14th Amendment includes the “due process clause,” which courts have interpreted to guarantee open government proceedings and appeals.
Goldstein argues that his property — and his employees’ labor, and that of thousands of others -- was taken, without any compensation, and in “an arbitrary and capricious manner."
Wolf, six weeks after the process closed, has finally released the names, but not the requests, circumstances, or deliberations leading to exemption approvals, denials and decisions to classify many applicants among those who didn’t need exemptions. “Who got waivers? Political supporters? Were opponents denied?" says Goldstein. "And there’s no appeal. You’re just closed.”
His lawsuit, filed March 26 in federal court, seeks an injunction stopping Wolf from enforcing the closures until the state offers “just compensation” and appeal review for those turned down.
Losing their skilled jobs was "terrifying for workers” at Schulmerich, and a big disruption for customers, the suit notes. The shutdown hit post Easter at the peak of bell-repair season, as schools and houses of worship send bells to be fixed and cleaned.
Mark Shade, a spokesperson for Attorney General Josh Shapiro, whose office is defending Wolf, said it’s “too early” to comment on the case.
But he sent me the briefs that the state has filed in the failed state-court complaints, which challenged Wolf’s shutdown authority. They were shot down by state courts.. The state’s briefs in those appeals also address, to a degree, the constitutional issues raised by Goldstein.
The state maintains that federal courts haven’t required compensation for property taken to stop “a public nuisance” — ordering trees cut down to stop a plant epidemic —- or in cases where owners were deprived of property “temporarily.” And the courts have recognized that emergencies may force governments to make “summary” decisions.
However, none of the referenced cases seem to involve service businesses forced to close permanently when a prolonged, government-ordered shutdown left them broke.
But the state did point out that federal courts have been reluctant to grant injunctions when damages might be recouped through civil lawsuits against the government.
Pennsylvania has no shortage of aggrieved business owners, or plaintiff lawyers. So it’s possible coronavirus business litigation and attempts to collect damages will continue in Pennsylvania, even after Gov. Wolf (who serves until 2022), his order, and the virus, have gone away.