Friday, January 11, 2008
Carlisle loses $216,000 tax suit
The state Court of Appeals has ruled against Carlisle in a suit that may cost the town over $300,000. The suit involved land on West Street originally owned by A.E. Benfield and now under South Street Nominee Trust. The land was taken out of a forestry restriction in 2002 in order to be subdivided for housing lots. At the time, the town claimed roll-back taxes which have now been disallowed due to ambiguity in the tax code. This reverses a previous tax board decision which had been in Carlisle's favor.
Chapter 61 provides for a landowner to receive significant tax benefits in exchange for a long-term commitment to keeping land in farming or forestry. The land in question had received a 95% reduction in taxes over about 30 years, according to Town Assessor John Speidel. He believes the town should have been able to recover some of the tax benefit when the land was removed from classification and used or another purpose. However, the court decision notes some ambiguity in the law, requiring a ruling in favor of the taxpayer.
Originally, the town had billed $216,000 in roll-back taxes and was supported by a state Appellate Tax Board ruling. However, the Trust appealed the decision and has now received a judgment in its favor. Under state law, the town is now liable for the original amount plus 8% interest that has accrued, for a total that will surpass $300,000.
Spiedel said Carlisle is appealing the decision to the Massachusetts Supreme Judicial Court. It will be several weeks before the town knows whether the court will agree to hear the suit. One of the factors in Carlisle's favor is the precedent-setting nature of the Court of Appeals decision, which could severely impact towns in western Massachusetts with significant lands under 61 restriction.
A tax board ruling in April, 2007 regarding another Benfield parcel on which the town had charged a $83,000 roll back was also decided in favor of the taxpayer. Speidel noted the town will decide soon whether to appeal that decision or pay the now $92,000 (with interest) and be done with it.
© 2008 The