As an update to our previous post, the Supreme Judicial Court (SJC) today reversed the Appellate Tax Board (ATB) and held that forest land owned by a private conservation organization should be exempt from local property taxes.
The decision in New England Forestry Foundation, Inc. v. Board of Assessors of the Town of Hawley (SJC-11432) will come as relief to nonprofits, which feared hefty tax bills if the SJC had endorsed the ATB’s strict approach to private conservation land.
The SJC held that 120 acres of forest land owned by New England Forestry Foundation, Inc. (NEFF) in the Town of Hawley was eligible for the charitable exemption from property taxes provided by M.G.L. c. 59, § 5, Clause Third. The ATB previously upheld the Town’s denial of a tax exemption for NEFF, finding that a lack of convenient public access to the NEFF property and the limited nature of NEFF’s forestry education activities were evidence that NEFF’s forest land did not benefit the public at large or relieve the government of any burdens.
In reversing the ATB, the SJC noted that NEFF’s ownership of the land for conservation purposes was charitable in nature and relieved the government of its burden to safeguard natural resources and environmental quality. Moreover, the SJC held that where public access to private conservation land is not necessary to further an organization’s charitable purpose, an organization is not required to promote public access in order to maintain its tax exemption.
Submitting amicus briefs on behalf of NEFF were the Nature Conservancy, the Massachusetts Audubon Society, The Trustees of Reservations, the Massachusetts Land Trust Coalition, Inc., the Land Trust Alliance, Inc., the Massachusetts Association of Conservation Commissions, Inc., and The Compact of Cape Cod Conservation Trusts, Inc. The Massachusetts Association of Assessing Officers submitted an amicus brief in support of the Town of Hawley.
You can read the full SJC decision here.
On Solid Ground: The Mirick Real Estate Law Blog 
Let me predicate this as my views on the Supreme Judicial Court ruling in favor of NEFF over the Town of Hawley. I am not one of the Assessors, although I do assist the Board, and did assist them at the initial Appellate Tax Board hearing.
The Assessors adhered to the letter of the law. They never questioned whether New England Forestry Foundation (NEFF) was a charitable organization. In order to qualify for a property tax exemption in any community in the Commonwealth of Massachusetts as a charitable organization, the specific property in questions has to be actively used for the stated charitable purposes. NEFF’s summary of their primary mission, function or purpose is “To educate through practical demonstration the conservation and sound management of the region’s private and municipal forest lands.” The Assessors requested any kind of explanation as to how they accomplish this mission on the land in Hawley. What “education” do they do in Hawley? What “practical demonstration” do they do in Hawley? As they failed to provide this information, the application for exemption was denied. That decision was upheld by the Appellate Tax Board (ATB). They did not provide the information that was needed to qualify for an exemption, under the letter of the law.
An important fact to include is that NEFF was taxed for every year that they owned the parcel. The Assessors did not suddenly decide to start taxing NEFF. NEFF was assessed and paid property taxes for at least the first eight years of ownership without question. Suddenly they decided, when their Forest Management Plan was approaching expiration, to apply for a full exemption. Since then, they allowed their Management Plan to lapse – according to the Decision, NEFF updated their plan in 2009, but that was never officially completed, and a copy was never provided to the Town. Instead, they held a timber harvest to make money off of the property.
Even during the ATB hearing, it seemed that NEFF had a preconceived plan. It seems that what they were attempting to do, was to secure an exemption based solely on them being a land conservation organization overall, and what they did on the specific parcel of Hawley appeared to be immaterial.
As far as lessening the burdens of government by providing carbon sequestration, fresh water, and fresh air… in a town that is largely heavily wooded? It only lessens the burdens of government in more urban environments. It adds to the burdens of government in a small town with an annual budget just over $1 million and a population of fewer than 350 people.
There is a Buddhist Temple here in Hawley. They qualify for an exemption as a house of worship. Each year they give the town a payment in lieu of taxes. NEFF has made no indication of any intention to make a payment in lieu of taxes in any amount. Even the Commonwealth of Massachusetts makes a payment in lieu of taxes – not as much as they promised when land was first being acquired, but a payment nonetheless.
Franklin Land Trust also works to conserve land, and is currently working with several landowners to place conservation restrictions (CRs) on parcels that are currently under Chapter 61. These CRs are co-held with the Town. The ownership stays with the landowner, and taxes are still paid. If the landowner opts to discontinue the Chapter 61 status, the assessment will increase a little, and taxes will still be paid. Land will be conserved, but the tax base in Hawley will not be disrupted.
The Nature Conservancy, UMASS Foundation and the Five Colleges own property in Hawley. This property contains and surrounds a rare bog. The Assessors never questioned their tax exempt status, as the parcel clearly had a feature that needed preservation, and educational activities are regularly held on the property. Had the ruling of this SJC case been to uphold the ATB decision, the tax exemption for this property would have remained intact. It was never in jeopardy.
Furthermore, NEFF engages in forestry, which means that they will periodically do a timber harvest, requiring heavy equipment and trucks traveling over the roads of Hawley. The additional wear on the roadways will cost the town money. They are not a charitable organization that does not create a cost for the towns that they own property in – their inherent operation costs towns money.
Another question that I have been wondering about is why the main public use of this specific parcel (NEFF’s parcel in Hawley) is snowmobiling. I do not know the exact environmental impact of snowmobiling, but it seems that there would be a pollution factor – whether due to exhaust, or noise. If property is to be conserved, why are motorized recreational vehicles encouraged to use it? Walking in the State Forest, I know how intrusive listening to dirt bikes, atv’s and snowmobiles can be. It seems quite inconsistent with protecting “habitat, water and other natural resources”.
Virginia Gabert