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Local Aid and Finance ATB closes telecom property tax loophole
In a major victory for cities and towns, the Appellate Tax Board yesterday ruled that telephone companies must pay property taxes on poles and wires on public ways.
Ron Rakow, Boston’s commissioner of assessing, said the ruling could be worth more than $50 million in property tax revenue for communities statewide. The exact amount will be determined when the ATB takes up the valuation phase of the case late this month.
The ATB ruled on appeals brought by more than 150 communities for fiscal years 2003 through 2008. If it is upheld, the precedent-setting decision would apply to all cities and towns beginning in fiscal 2009.
As in past cases in litigation, these funds may be available for expenditure only after litigation is complete. State officials said the telecommunications firms can appeal to the state Appeals Court, and then the Supreme Judicial Court. The SJC could even decide to take an appeal directly.
Closing the antiquated telecommunications property tax loophole, used by telephone companies to avoid property taxes, has been a long-time priority for the MMA. A provision to close the century-old loophole on poles, wires and equipment on public ways was included by the administration in its Municipal Partnership Act legislation, though the proposal has languished in the Legislature.
The ATB ruling addresses only poles and wires; state law would need to be changed to include equipment. In total, the telecommunications property tax loophole is estimated to cost cities and towns $78 million in lost revenue.
The MMA applauded the ATB’s ruling and the petitioning communities who presented their case with distinction. The association will continue its efforts to close this loophole as this process moves ahead.
[On March 11, the Division of Local Services issued Bulletin 2008-03B, Assessment of Poles and Wires on Public Ways, to inform local officials of the effect of the ATB ruling. The bulletin is available for download below.]
The MMA will be posting further information on this ruling on this Web site at it becomes available.
• Download Appellate Tax Board ruling (260K PDF)
Local Aid and Finance ATB closes telecom property tax loophole
ATB closes telecom property tax loophole
In a major victory for cities and towns, the Appellate Tax Board yesterday ruled that telephone companies must pay property taxes on poles and wires on public ways.
Ron Rakow, Boston’s commissioner of assessing, said the ruling could be worth more than $50 million in property tax revenue for communities statewide. The exact amount will be determined when the ATB takes up the valuation phase of the case late this month.
The ATB ruled on appeals brought by more than 150 communities for fiscal years 2003 through 2008. If it is upheld, the precedent-setting decision would apply to all cities and towns beginning in fiscal 2009.
As in past cases in litigation, these funds may be available for expenditure only after litigation is complete. State officials said the telecommunications firms can appeal to the state Appeals Court, and then the Supreme Judicial Court. The SJC could even decide to take an appeal directly.
Closing the antiquated telecommunications property tax loophole, used by telephone companies to avoid property taxes, has been a long-time priority for the MMA. A provision to close the century-old loophole on poles, wires and equipment on public ways was included by the administration in its Municipal Partnership Act legislation, though the proposal has languished in the Legislature.
The ATB ruling addresses only poles and wires; state law would need to be changed to include equipment. In total, the telecommunications property tax loophole is estimated to cost cities and towns $78 million in lost revenue.
The MMA applauded the ATB’s ruling and the petitioning communities who presented their case with distinction. The association will continue its efforts to close this loophole as this process moves ahead.
[On March 11, the Division of Local Services issued Bulletin 2008-03B, Assessment of Poles and Wires on Public Ways, to inform local officials of the effect of the ATB ruling. The bulletin is available for download below.]
The MMA will be posting further information on this ruling on this Web site at it becomes available.
• Download Appellate Tax Board ruling (260K PDF)
• Download DLS Bulletin 2008-03, Assessment of Poles and Wires on Public Ways (36K PDF)
Written by MMA Publications/Web Director John Ouellette
