Verizon New England, Inc. v. Board of Assessors of Boston , 475 Mass. 826 ( 2016 )

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SJC-12034
VERIZON NEW ENGLAND INC. vs. BOARD OF ASSESSORS OF BOSTON
(and a consolidated case1).
Suffolk. April 7, 2016. - November 2, 2016.
Present: Gants, C.J., Spina, Cordy, Botsford, Duffly, & Hines,
JJ.2
Telephone Company. Taxation, Assessors, Personal property tax:
value. Constitutional Law, Taxation.
Appeal from a decision of the Appellate Tax Board.
The Supreme Judicial Court on its own initiative
transferred the case from the Appeals Court.
William Hazel for the taxpayers.
Anthony M. Ambriano for board of assessors of Boston.
Maura Healey, Attorney General, & Daniel J. Hammond,
Assistant Attorney General, for Attorney General & another,
amici curiae, submitted a brief.
Kenneth W. Gurge, for Massachusetts Municipal Association &
others, amici curiae, submitted a brief.
1
RCN BecoCom LLC vs. Board of Assessors of Boston.
2
Justices Spina, Cordy, and Duffly participated in the
deliberation on this case prior to their retirements.
2
BOTSFORD, J. Two telephone companies appeal from a
decision of the Appellate Tax Board (board) upholding the
property tax assessments by the board of assessors of Boston
(assessors) for fiscal year (FY) 2012 on certain personal
property each company owns. At issue is whether the tax
assessments, which were based on a "split" tax rate structure
determined in accordance with G. L. c. 40, § 56 (§ 56),
constituted a disproportionate tax that, as such, violated the
Constitution of the Commonwealth. More particularly, the
question is whether the split tax rate structure authorized by
§ 56 -- a rate structure that provides for taxable personal
property to be taxed at a rate identical to the rate applied to
commercial and industrial real property but higher than the rate
that would apply if all taxable property, real and personal,
were taxed at a single, uniform rate -- violates the
proportionality requirement of Part II, c. 1, § 1, art. 4, of
the Constitution of the Commonwealth, as amended by art. 112 of
the Amendments to the Constitution, as well as art. 10 of the
Massachusetts Declaration of Rights. We conclude that the split
tax structure authorized by § 56 and related statutes does not
violate the Massachusetts Constitution. We affirm the board's
decision.3
3
We acknowledge the amicus curiae briefs submitted by the
Attorney General and the Commissioner of Revenue; and by the
3
1. Background.4 a. Procedural background. Verizon New
England Inc. (Verizon) and RCN BecoCom LLC (RCN) (collectively,
taxpayers) are subject to property tax in the city of Boston on
personal property consisting primarily of machinery, poles,
underground conduits, wires, and pipes (§ 39 property) that they
own and use for business purposes. Pursuant to G. L. c. 59,
§ 39, the Commissioner of Revenue (commissioner) is required on
an annual basis to centrally determine and certify the valuation
of this type of property owned by telephone and telegraph
companies, including the taxpayers; the commissioner's certified
central valuations then become the basis for tax assessments by
the assessors in each city and town where such property is
located and subject to taxation, including Boston. For purposes
of property tax assessments for fiscal year 2012, the
commissioner centrally valued the § 39 property owned by Verizon
in Boston at $215,846,800, and the § 39 property owned by RCN in
Boston at $48,444,900.5 The assessors thereafter assessed a
Massachusetts Municipal Association, Massachusetts Association
of Assessing Officers, and Massachusetts Municipal Lawyers
Association.
4
The background facts are undisputed. These cases were
submitted to the Appellate Tax Board (board) on the parties'
statement of agreed facts and accompanying exhibits; the board
made findings based on the statement of agreed facts.
5
The taxpayers do not contest the values of their § 39
personal property determined by the Commissioner of Revenue
(commissioner) for fiscal year (FY) 2012.
4
property tax for FY 2012 on Verizon's § 39 property at the tax
rate of $31.92 per thousand dollars of value for a total
assessment of $6,889,829.86; they assessed a FY 2012 tax on
RCN's § 39 property at the same rate of $31.92 per thousand for
a total assessment of $1,546,361.21. The taxpayers timely paid
the personal property taxes thus assessed, and then timely filed
abatement applications with the assessors.6 The requested
abatements were denied, and both taxpayers filed timely appeals
with the board. On April 24, 2013, the board consolidated the
taxpayers' petitions for hearing. On October 24, 2014, the
board issued its decision denying the taxpayers' appeals, and
thereafter issued findings of fact and a report. The taxpayers
timely appealed to the Appeals Court, and we transferred the
case on our own motion.
b. Constitutional and statutory background. Part II,
c. 1, § 1, art. 4 (art. 4), of the Constitution of the
Commonwealth, as amended in 1978 by art. 112 of the Amendments
(art. 112) authorizes the Legislature
6
Verizon sought a tax abatement in the amount of
$2,952,784.23, and RCN sought a tax abatement in the amount of
$662,726.23. The abatements sought in each case represented the
difference between the amount of property tax assessed at $31.92
per thousand dollars of value and what the assessment would have
been if the taxpayer's § 39 property had been assessed at $18.24
per thousand dollars, the rate that would have been applied if
all taxable real and personal property were taxed at a single
rate in FY 2012, give the total amount of Boston's FY 2012 tax
levy.
5
"to impose and levy proportional and reasonable
assessments, rates, and taxes, upon all the inhabitants of,
and persons resident, and estates lying, within the said
commonwealth, except that, in addition to the powers
conferred under Articles XLI and XCIX of the Amendments,[7]
the general court may classify real property according to
its use in no more than four classes and to assess, rate
and tax such property differently in the classes so
established, but proportionately in the same class, and
except that reasonable exemptions may be granted" (emphasis
supplied).8
Before it was amended by art. 112, art. 4 had been
consistently interpreted by this court to require that
"all taxes levied under [the taxing authority of art. 4] be
'proportional and reasonable,' and [art. 4] forbids their
imposition upon one class of persons or property at a
different rate from that which is applied to other classes,
whether that discrimination is effected directly in the
assessment or indirectly through arbitrary and unequal
methods of valuation."
Cheshire v. County Comm'rs of Berkshire, 118 Mass. 386, 389
(1875). See, e.g., President, Directors, & Co. of the Portland
Bank v. Apthorp, 12 Mass. 252, 255 (1815); Oliver v. Washington
Mills, 11 Allen 268, 275 (1865); Opinion of the Justices, 220
Mass. 613, 618-619, 621 (1915); Opinion of the Justices, 332
7
Article 41 of the Amendments to the Massachusetts
Constitution, as amended by art. 110 of the Amendments, and art.
99 of the Amendments grant the Legislature broad authority over
the taxation of wild or forest lands (art. 41) and agricultural
or horticultural lands (art. 99).
8
The portion of Part II, c. 1, § 1, art. 4 (art. 4), of the
Constitution of the Commonwealth highlighted in the text was
added to art. 4 by art. 112 of the Amendments to the
Constitution (art. 112).
6
Mass. 769, 778-779 (1955); Bettigole v. Assessors of
Springfield, 343 Mass. 223, 230-231 (1961).
In practice, however, local municipal assessors -- to whom
the Legislature has delegated for over two centuries the power
to assess local property taxes, see Opinion of the Justices, 378
Mass. 802, 810 & n.11 (1979) -- did not follow this
constitutional mandate of strict proportionality, or the
statutory requirement that local assessment of property taxes be
based on "a fair cash valuation of all the estate, real and
personal, subject to taxation therein." G. L. c. 59, § 38. See
Bettigole, 343 Mass. at 231-232. See also Sudbury v.
Commissioner of Corps. & Taxation, 366 Mass. 558, 563 (1974);
Shoppers' World, Inc. v. Assessors of Framingham, 348 Mass. 366,
371-372 (1965). Rather, there was a widespread practice of
employing varying percentages of fair cash values that favored
residential properties at the expense of commercial and
industrial properties. See Keniston v. Assessors of Boston, 380
Mass. 888, 890-891 (1980); Bettigole, supra at 227-228.
Particularly beginning in the 1960s this court more insistently
declared disproportionate assessments of property illegal and
also broadened remedies available to taxpayers bringing claims
of disproportionate taxation. See Sudbury, supra at 568-569;
Shoppers' World, Inc., supra at 372-373 (1965); Bettigole, supra
at 236-237; Stone v. Springfield, 341 Mass. 246, 248 (1960).
7
However, in the midst of the "accelerated judicial enforcement
of the [proportionate taxation and] fair cash valuation
requirement, . . . there was public challenge to the concept of
100% valuation" (citation omitted), Keniston, 380 Mass. at 891,
and in response to this public sentiment, the General Court
approved in 1975 and again in 1977 the constitutional amendment
embodied in art. 112; the amendment was ratified by the voters
on November 7, 1978 -- by a two-to-one margin.9 See Associated
Indus. of Mass., Inc. v. Commissioner of Revenue, 378 Mass. 657,
659 (1979); Opinion of the Justices, supra at 804. Accord
Keniston, supra. Article 112 empowered the Legislature to
establish a property tax system that would impose "different
rates of taxation on different classes of real property,"
Opinion of the Justices, supra, and that in practical effect
would resemble and legitimize the long-time local practice of
establishing relatively lower property tax assessments for
residential property and vacant land or open space as compared
to other classes of property. See id. at 804-805.
Article 112 permits the Legislature to establish different
classes of real property and to tax the different classes at
different rates, so long as all real property within a class is
taxed at the same rate. In anticipation of the ratification of
9
See Rogers, Classification Guidelines Ahead, Boston Globe,
Nov. 9, 1978, at 45.
8
art. 112, the Legislature enacted legislation, St. 1978, c. 580,
that, pursuant to the authority contained in the proposed
amendment, created a property tax system based on classifying
real property in four classes. In 1979, following the
amendment's ratification, the Legislature considered a somewhat
different classification system and submitted two questions to
this court concerning the constitutionality of certain of its
features.10 See Opinion of the Justices, 378 Mass. at 802, 806-
815. Following receipt of our affirmative answers to its
questions, the Legislature enacted new legislation, St. 1979,
c. 797, to implement art. 112, establishing a property tax
structure almost identical to that proposed. At the same time,
the Legislature also repealed the classification provisions of
St. 1978, c. 580. See St. 1979, c. 797, § 23. See also St.
1980, c. 261, § 16.
The implementing legislation set out in St. 1979, c. 797,
is codified as G. L. c. 40, § 56; G. L. c. 58, § 1A; and G. L.
c. 59, § 2A, and remains in effect;11 the assessors here
10
The constitutional questions we answered in Opinion of
the Justices, 378 Mass. 802 (1979), did not directly concern the
central issue in this case about the meaning of "proportional
and reasonable assessments" as it relates to personal property
in art. 4, as amended by amendment art. 112. Our opinion in
that case is nonetheless of some relevance here, as we discuss
in note 22, infra.
11
The sections of the General Laws cited in the text that
were added by St. 1979, c. 797, have been subsequently amended
9
implemented the split tax structure in place in Boston for
FY 2012 pursuant to these statutes.12 Under them, the
commissioner is required every three years to determine, within
each city and town in the Commonwealth, whether the locally
assessed values represent the full and fair cash valuation for
each class of real property, defined in c. 59, § 2A,13 and for
all personal property not exempt from local taxation. See G. L.
c. 40, § 56; G. L. c. 58, § 1A.14 For every municipality that
the commissioner determines is using full and fair cash
valuation, the commissioner also ascertains a "minimum
residential factor" (MRF).15 See G. L. c. 40, § 56; G. L. c. 58,
§ 1A.
in a number of respects, but the amendments do not affect the
parties' arguments in the present case.
12
In FY 2012, there were 108 municipalities, including
Boston, that elected a split rate tax scheme pursuant to § 56,
and 243 municipalities that elected a single rate tax scheme.
13
Under G. L. c. 59, § 2A, real property may be classified
into four classes: residential, open space, commercial, and
industrial; § 2A defines each such class.
14
When the commissioner certifies that the municipality's
assessments are at full and fair cash value, the certification
may be relied on for the year in which it is made and the two
years following. See G. L. c. 40, § 56 (§ 56).
15
The minimum residential factor (MRF) caps the degree to
which the city or town may shift the over-all tax burden from
the residential and open space property classes to the
commercial and industrial real property classes and to personal
property. See G. L. c. 58, § 1A, second par.
10
The municipality next determines "the percentages of local
tax levy to be borne by each class of real property, as defined
in [G. L. c. 59, § 2A], and personal property." G. L. c. 40,
§ 56. To do so, the municipality first adopts a residential
factor (RF) to be applied in making the determination of local
levy percentages for each class of property; the RF may not be
less than the MRF determined by the commissioner. Id. The
municipality then determines the tax rate per thousand dollars
of value for each class of property by dividing the share of the
levy to be raised by each class by the total assessed valuation
for that class, and multiplying the result by 1,000.16 Id.
16
In adopting a residential factor (RF), the municipality
chooses whether to use a split tax structure or a unified tax
structure in assessing property taxes. If it chooses to use an
RF of one, a single tax rate applies equally to all taxable
property and the percentage of the local tax levy borne by each
type of property should equal the percentage of the total value
of real and personal property represented by that type of
property. By way of illustration, if residential property
comprises eighty per cent of the total assessed valuation of all
real and personal property in a city, under an RF of one,
residential property owners collectively will pay eighty per
cent of the total property tax levy. If the city elects to use
an RF of less than one, the share of the total tax levy borne by
the residential and open space classes of real property will be
reduced to a point lower than the percentage of the total
property valuation represented by these two types of property,
and the relative share of the total tax levy for which other
classes of real property as well as personal property are
responsible will correspondingly increase. The result is a
percentage shift in tax obligations in favor of residential and
open space real property.
The statutory formula is set out in § 56, and also draws on
G. L. c. 58, § 1A. For present purposes, the formula may be
11
c. Factual background. Turning to this case, for FY 2012,
Boston elected to adopt a split rate tax structure pursuant to
§ 56.17 The city having elected to use an RF of 59.6005%, the
most easily explained by way of illustration. Assume that in a
particular city or town, the total value of property by class is
as follows:
Residential: $ 500,000
Open Space: $ 20,000
Commercial: $ 200,000
Industrial: $ 200,000
Personal: $ 80,000
Total Property Valuation: $ 1,000,000
Assume further that the city elects a residential factor of .80,
or 80%, and chooses to multiply the RF by 75% for the open space
determination. The percentage of tax levy borne by each class
would be as follows:
Residential: ($500,000/$1,000,000) x 80% = 40.0%
Open Space: ($20,000/$1,000,000) x (80% x 75%) = 1.2%
Commercial: ($200,000/$480,000) x (100% - 41.2% = 24.5%
[i.e., sum of residential and open
space percentages])
Industrial: ($200,000/$480,000) x (100% - 41.2%) = 24.5%
Personal: ($80,000/$480,000) x (100% - 41.2%) = 9.8%
Assuming the city's total tax levy for this year is $50,000, to
determine the tax rate for each class, the percentage of the
levy per class is divided by the total assessed valuation for
that class and multiplied by 1,000:
Residential: ($50,000 x 40%)/500,000 x 1,000 = $40.00
Open Space: ($50,000 x 1.2%)/20,000 x 1,000 = $30.00
Commercial: ($50,000 x 24.5%)/200,000 x 1,000 = $61.25
Industrial: ($50,000 x 24.5%)/200,000 x 1,000 = $61.25
Personal: ($50,000 x 9.8%)/80,000 x 1,000 = $61.25
17
The commissioner had certified in December, 2009, that
the assessors were assessing the real and personal property in
Boston at full and fair cash value, and that certification
remained in effect for FY 2012. See G. L. c. 40, § 56.
12
assessors determined the following percentages of the total tax
levy to be borne by each class of real property and by personal
property:
Classification Levy Percentage Tax Rate Per Thousand
Residential 38.7353% $13.04
Open Space 0% $0.00
Commercial 50.39987% $31.92
Industrial 1.3352% $31.92
Personal 8.9308% $31.92
On December 12, 2011, the commissioner approved and certified
Boston's FY 2012 tax rates.
Under the FY 2012 tax rates in Boston, personal property as
a whole constituted 8.9308% of the tax levy, but it accounted
for 5.1033% of the total valuation of all real and personal
property situated in the city; residential property made up
38.7353% of the total tax levy, but accounted for 64.9915% of
the total valuation of all real and personal property located in
the city. With respect to the two taxpayers in this case,
Verizon's taxable property situated in Boston for FY 2012 was
approximately .2439% of the value of all taxable property in the
city, but Verizon was required to pay .4269% of the total tax
levy; RCN's taxable property was approximately .0547% of the
total taxable property, but RCN was required to pay .0958% of
the total tax levy. At the same time, the value of Verizon's
§ 39 property was approximately 4.78% of the total valuation of
13
personal property and approximately 0.6966% of the total
valuation of property in the commercial, industrial, and
property (CIP) classes located in Boston for FY 2012, and the
tax assessed on that property represented these exact same
percentages of the total taxes levied on all personal property
and all CIP property, respectively. For RCN, the value of its
§ 39 property was 1.07% of the total valuation of personal
property and 0.156% of the total valuation of property in the
CIP classes for FY 2012, and the same respective percentages of
the total taxes levied on all personal property and CIP
property, for that year.
2. Discussion. The taxpayers argue that art. 112 created
a limited exception to art. 4's overarching proportionality
requirement, an exception that applies solely to the taxation of
real property, and based on the plain language of art. 112, the
tax treatment of personal property remains unchanged by art.
112. That is, the taxpayers argue that, just as was true before
the ratification of art. 112, in order to conform to art. 4's
mandate that tax assessments be "proportional and reasonable,"
the assessors should have imposed a tax rate on personal
property that would result in owners of personal property being
responsible only for their proportionate share of the tax levy,
measured by the relative value of their personal property
compared to the total value of all the taxable property in
14
Boston, real and personal. On the facts of this case, that
measurement would have yielded a tax rate of $18.24 per thousand
dollars of value, rather than the rate of $31.92 per thousand
dollars of value applied by the assessors, which is 1.75 times
greater. The taxpayers contend that because the tax rate
applied to their personal property in FY 2012 exceeded this
permissible limit, the tax was unconstitutionally
disproportionate in violation both of art. 4 and of art. 10 of
the Massachusetts Declaration of Rights. We disagree.
As the board's decision states, and the taxpayers do not
dispute, the assessors determined the challenged FY 2012 tax
rates and assessments in compliance with the provisions of
§ 56.18 The taxpayers' challenge, therefore, is that the split
tax structure permitted by § 56 is unconstitutional because it
imposes a disproportionate tax on owners of personal property
and there is no constitutional authority to do so. The board
disagreed, and its opinion sets forth the board's reasoning in
some detail, but questions of constitutional interpretation are
questions of law, and we review them de novo. See RCN-BecoCom,
LLC v. Commissioner of Revenue, 443 Mass. 198, 201-202 (2005).
18
Section 56 is the specific statute providing the option
of a split tax structure and therefore the focus of the
taxpayers' challenge in this case, but it is undisputed that
implementation of the split tax structure option under § 56 also
brings into play the related statutes, G. L. c. 58, § 1A, and
G. L. c. 59, § 2A. The taxpayers do not challenge the
constitutionality of these two statutes.
15
See also Geoffrey, Inc. v. Commissioner of Revenue, 453 Mass.
17, 22, cert. denied, 557 U.S. 920 (2009).
"We start from the premise that '[a] tax measure is
presumed valid and is entitled to the benefit of any
constitutional doubt, and the burden of proving its invalidity
falls on those who challenge the measure." WB&T Mtge. Co. v.
Assessors of Boston, 451 Mass. 716, 721 (2008), quoting Opinion
of the Justices, 425 Mass. 1201, 1203-1204 (1997). A party
challenging the validity of a tax measure must "establish[] its
invalidity 'beyond a rational doubt'" (citation omitted).
Geoffrey, Inc., 453 Mass. at 22.19
19
The taxpayers argue that their constitutional challenge
to § 56 is to the statute as applied to them rather than a
facial challenge. Their argument appears to be based on the
ground that the statute gives municipalities the option of
imposing either a single tax rate to all classes of property,
real and personal, or a split tax rate that differentiates
between residential (and open space) property and other classes
of property. The argument seems to be that if Boston had
elected to adopt a single rate tax structure for FY 2012, § 56
would have been constitutionally applied to them, and was only
unconstitutional in this case because the split tax rate
alternative was chosen. The argument fails. Because § 56
explicitly authorizes municipalities to implement a split rate
tax structure, the taxpayers' challenge represents a facial
attack on the statute itself. A facial challenge is "the
weakest form of challenge, and the one that is the least likely
to succeed." Blixt v. Blixt, 437 Mass. 649, 652 (2002), cert.
denied, 537 U.S. 1189 (2003). But whether facial or as applied,
when bringing a constitutional challenge to a tax statute, as
stated in the text, the challenger bears a heavy burden to
overcome a strong presumption of validity. See Andover Sav.
Bank v. Commissioner of Revenue, 387 Mass. 229, 235 (1982).
16
Determining the constitutional validity of § 56 requires an
examination of art. 112 and in particular, how art. 112 affected
the proportionality requirement within art. 4. Our cases have
defined principles that guide our analysis: "A constitutional
amendment should be 'interpreted in the light of the conditions
under which it . . . [was] framed, the ends which it was
designed to accomplish, the benefits which it was expected to
confer, and the evils which it was hoped to remedy.'" Mazzone
v. Attorney Gen., 432 Mass. 515, 526 (2000), quoting Tax Comm'r
v. Putnam, 227 Mass. 522, 524 (1917). See Attorney Gen. v.
Methuen, 236 Mass. 564, 573 (1921). "An amendment to the
Constitution is one of the most solemn and important of
instruments. It commonly is a brief and comprehensive statement
of general principle of government. . . . Its words should be
interpreted in a sense most obvious to the common understanding
at the time of its adoption, because it is proposed for public
adoption and must be understood by all entitled to vote"
(citation omitted). Cohen v. Attorney Gen., 357 Mass. 564, 571
(1970).
As discussed earlier in this opinion, before art. 112 was
ratified, beginning early in the Nineteenth Century, see
President, Directors, & Co. of the Portland Bank, 12 Mass. at
255, and continuing, art. 4 was uniformly interpreted to forbid
the imposition of taxes "upon one class of persons or property
17
at a different rate from that which is applied to other classes,
whether that discrimination [was] effected directly in the
assessment or indirectly through arbitrary and unequal methods
of valuation." Cheshire, 118 Mass. at 389. See Bettigole, 343
Mass. at 230-232. As also discussed, because of popular
dissatisfaction with the combined effect of the constitutional
proportionality requirement and the statutory obligation of
municipalities to assess residential property and vacant land
(open space) at full and fair cash value and in the same manner
as all other types of property, the Legislature in response
proposed art. 112 as an amendment to art. 4. See Associated
Indus. of Mass., Inc., 378 Mass. at 659; Opinion of the
Justices, 378 Mass. at 804.
This history reflects that the animating purpose of art.
112 was to change the meaning of proportionality in art. 4 in
order to enable residential property to be treated differently
from other property classes. Article 112 must be interpreted to
give effect to this purpose, see, e.g., Mazzone, 432 Mass. at
526, and our review of the constitutionality of § 56, in turn,
must consider whether the statute helps to effectuate this
purpose. It does.
Section 56 -- in combination with G. L. c. 58, § 1A, and
G. L. c. 59, § 2A, see St. 1979, c. 797 -- authorizes a city or
town to adopt a split tax rate structure that enables it to tax
18
residential and open space property at a lower effective tax
rate than all other classes or types of property. At the same
time, § 56 adheres to or at least supports the principle of
proportionality with respect to all such other property types by
treating commercial real property, industrial real property, and
personal property -- the CIP classes -- in the exact same
manner.20 In contrast, the taxpayers' interpretation of art. 112
would contradict the concept of proportionality by creating a
single and separate tax rate for personal property, treating it
differently from all other classes of property.
The taxpayers argue that art. 112 effected a "narrow"
exception to the proportionality requirement of art. 4, one
limited to real property, and they suggest that, as an
exception, art. 112 must itself be construed narrowly. Their
argument might have more force if it were directed at the
language of a statute rather than a constitutional amendment; we
have certainly stated that "[e]xceptions to statutory provisions
are construed narrowly." See LeClair v. Norwell, 430 Mass. 328,
336 (1999). Cf. New England Forestry Found., Inc. v. Assessors
of Hawley, 468 Mass. 138, 148 (2014) ("Exemption statutes [here,
property tax exemption statute] are strictly construed . . .").
20
Boston's effective tax rates for FY 2012 illustrate this
point: residential property had an effective tax rate of $13.04
per thousand dollars of value, and commercial, industrial, and
personal property had an effective tax rate of $31.92 per
thousand dollars of value.
19
But a constitutional amendment "is a statement of general
principles and not a specification of details. . . . It is to
be interpreted as the Constitution of a State and not as a
statute or an ordinary piece of legislation. Its words must be
given a construction adapted to carry into effect its purpose."
McDuffy v. Secretary of the Executive Office of Educ., 415 Mass.
545, 559 (1993), quoting Cohen, 357 Mass. at 371. In the case
of art. 112, its purpose of enabling cities and towns to tax
residential property at an effective rate different from and
lower than other property is clear, and because art. 112 is a
constitutional amendment, we do not interpret it narrowly,
despite its inclusion of the phrase, "except that." The
Legislature understood from the outset -- as shown by the fact
that it enacted contingent legislation to implement art. 112
before the amendment had even been ratified by the voters, see
Associated Indus., 378 Mass. at 659, 662-663 -- that art. 112
did indeed state "general principles" that would require
fleshing out in implementing statutes. Section 56 is such a
statute. It effectuates the overarching objective of art. 112,
and does so in a manner that retains proportionality to a large
extent by treating nonexempt personal property -- which, as in
this case, is used for business purposes21 -- the same as
commercial and industrial real property.22
21
It may well be the case that most nonexempt personal
20
We conclude that the board's decision rejecting the
taxpayers' challenge to the constitutionality of § 56 and
upholding the commissioner's denial of the requested tax
abatements was correct.
3. Conclusion. The decision of the Appellate Tax Board is
affirmed.
So ordered.
property is used for business purposes; much if not all personal
property used by individuals for nonbusiness purposes is exempt
from property tax. See, e.g., G. L. c. 59, § 5, Twentieth.
22
Finally, although the taxpayers are correct that Opinion
of the Justices, 378 Mass. 802 (1979), did not address directly
the proportionality challenge they raise in this case, we think
it is of significance that the bill reviewed there by the court,
like § 56, treated personal property differently from (and less
favorably than) residential and open space property, and exactly
the same as commercial and industrial real property, and the
court's opinion clearly indicates that it reviewed and
understood this aspect of the proposed legislation. See id. at
807-808. The court expressed no reservation about the proposed
legislation's treatment of personal property, and certainly did
not suggest that insofar as personal property was treated as
part of the same "class" as industrial and commercial real
property and permitted to be taxed at a higher effective rate
than residential and open space property, the constitutionality
of the proposed legislation might be in question because of a
possible conflict with the general proportionality requirement
of art. 4.