The suit, which was filed last week, alleges that the school district is violating state law by capping enrollment and refusing to provide funding for students beyond the 675 limit in Walter D. Palmer's operating charter.
The school, whose main campus is at 910 N. Sixth St., has nearly 900 students.
The suit charges that the district owes the school $1.7 million and that the state Department of Education has failed to deduct that amount from the district's portion of state aid and send it to the charter school. State law permits such action when districts refuse to pay tuition for students in charter schools.
In his brief supporting the Walter D. Palmer school, Piccola said that the legislature never intended to limit the growth of charter schools and that the Education Department had failed to enforce the ban on enrollment caps.
"Pennsylvania has 500 school districts," he said in a statement. "If Philadelphia imposes caps, which are clearly prohibited by state law, this practice could spread against the commonwealth, setting a dangerous precedent, creating further confusion, and, possibly, spawning further litigation."
A spokesman for the district declined to comment. An Education Department representative could not be reached.
Commonwealth Court has scheduled a hearing Wednesday on the charter school's request for a preliminary injunction to stop the Education Department from holding a hearing Thursday on the $1.7 million in disputed funds.
The charter alleges the hearing is improper and is asking the court to order the department to transfer the funds immediately to the charter school.
The school district has maintained the enrollment limits included in its charter agreements are permitted because the schools have signed on to them.
Piccola said schools cannot be said to have "agreed" to the caps because they have no choice but to sign the operating charters offered by the Philadelphia School Reform Commission.
District officials also have said the charter is not entitled to the additional money it is seeking because it added a high school program without authorization and enrolled too many students.
Contact staff writer Martha Woodall at 215-854-2789 or firstname.lastname@example.org.