The Massachusetts Appeals Court ruled today that Veolia, which generates steam at a Chinatown plant, owes the city of Boston $2.2 million in taxes for the 2015 fiscal year because it applied for a tax abatement via letters attached to its quarterly tax payments rather than through an official abatement form.
The court agreed with a decision by the state Appellate Tax Board that even though Veolia might have had a case for having the "personal property tax" waived - as had happened the year before - the law is the law and because Veolia didn't get around to filling out the right form until three months after the abatement deadline the company has to just suck it up and pay the tax.
Boston had never sought to apply the personal-property tax to Veolia's steam plant and distribution pipes until the 2013-2014 tax year, when the board of assessors ruled the company owed $2 million in taxes on the equipment. The company filed the proper form for an abatement by the state-imposed deadline, got turned down by the assessors, then appealed to the state Appellate Tax Board. The board sided with the company and ruled it was a "manufacturer" exempt from the particular city tax and so did not owe the city $2 million.
Undeterred by the state ruling, the assessors sent Veolia a bill for the same tax - this time for $2.2 million - for the 2014-2015 tax year. In the meantime, the city is appealing the tax board's decision for the earlier tax year, so the whole matter remains somewhat up in the air.
In any case, instead of filing a formal appeal with the assessors again the company made its quarterly payments, but with a letter attached to each check from its vice president for finance stating that the company had petitioned the Appellate Tax Board to overrule the assessors again.
The company finally did fill out the appropriate form to request an abatement - but not until more than three months after the deadline for filing for one, and only after somebody at the assessors' office called the VP to say they had no record of a formal abatement request.
This time, the Appellate Tax Board ruled against Veolia, not because it had changed its mind about whether the company is exempt from the tax, but because the law is pretty clear that the procedure for getting a tax abated starts with filling out the right form by the deadline. Since Veolia failed to follow that step, the board ruled, the company could not even argue for why it deserved an abatement.
In its ruling today, the appellate court agreed that the rules are the rules:
It is well settled that the remedy of abatement is a statutory one, and if any of the statute's requirements are not complied with, the remedy is lost.
More specifically, the court said those letters attached to Veolia's tax-payment checks did not count as abatement "applications," under the law, that they were hardly "a form approved by the commissioner [of revenue]" for abatements and that even though the company did finally fill out State Tax Form 128, it did so three months after the deadline.
In reaching our conclusion, we acknowledge that the result is a harsh one for Veolia, and will be particularly severe if the tax board's decision that the tax levied on its personal property for fiscal year 2014 was assessed unlawfully is affirmed. However, neither the statute, nor the relevant case law, permit a different conclusion. On the contrary, the Legislature has given no indication that cases interpreting the jurisdictional requirements of § 59, which was amended to include the present language in 1933, was not in accordance with its intention.