Overview:
Governor Maura Healey has signed an executive order to create a commission to examine the state's Payments in Lieu of Taxes (PILOT) program. The commission will develop a formula for the equitable distribution of PILOT payments to cities and towns that compensate for the loss of property taxes from state-owned lands. Municipal officials, especially those from the western part of the state, have long said that their communities are not fairly compensated for the loss of property tax revenues.
BOSTON – On Wednesday of last week, Gov. Maura Healey signed an Executive Order creating a commission to examine the state’s Payments in Lieu of Taxes (PILOT) program which compensates Massachusetts municipalities for the loss of property taxes from state-owned lands.
The commission will be charged with developing a formula for the equitable distribution of PILOT payments to cities and towns. Municipal officials, especially those from the western part of the state, have long said that their communities are not fairly compensated for the loss of property tax revenues.
The commission will be made up of representatives from several state agencies, including Administration and Finance, Energy and Environmental Affairs, Climate Resilience and Innovation, the Department of Revenue, the Department of Conservation and Recreation, the Department of Fish and Game, and the Director of Rural Affairs within the Executive Office of Economic Development, or their designee.
The state owns over a half-million acres of land for state parks and forests, wildlife sanctuaries, beaches, and state military campgrounds.
Town Manager Bill McKinney of Winchendon – which includes Winchendon State Forest, Otter River State Forest, Lake Dennison Recreation Area, and other state-owned properties – seemed less enthused about the governor’s announcement. Winchendon this year is receiving just under $186,000 in PILOT payments, according to McKinney.
“The question becomes, is it going to be additional funding or is it re-working the formula, like for Chapter 90 funding for roads,” he said. “The way the formula for Chapter 90 actually hurts Winchendon because payments are based on population and employment, in addition to road miles. If it was just based on road miles we’d be doing a lot better.”
McKinney said if the commission merely reworks the formula “with the same amount of money, guess what? The communities in eastern Mass would put up a fight, and they’re the ones with the power. The power center is in eastern Mass, so they’re not going to want to give up money to see it go to western Mass. That’s the problem; when you re-work the formula, someone has to give up something for someone else to benefit.”
Athol Town Manager Shaun Suhoski is a member of the Small-Town Administrators of Massachusetts, having recently served as president of the organization. Its members, he said, include representatives from small communities throughout western Massachusetts.
“Many of those small communities,” he said, “really do not get a fair value in PILOT payments for their state-owned land. I think of Clarksburg, way out west; I think of Hubbardston in central Mass. The value of preserving drinking water, forests, trees, which preserves air quality, is of benefit to eastern Massachusetts.
“I think it’s good the governor has set up a commission to look at the inequity and the inequity is real. I think this could lead to a better formula. I don’t think it will change the entire landscape, but I’m hopeful there will be reform.”
As far as Athol is concerned, Suhoski said, “We do have land that’s under DCR (Dept. of Conservation and Recreation), Fish & Wildlife, we have the Lawton State Forest. If they look at the formula and we get another five or ten thousand dollars per year, that’s great. But I don’t foresee it changing our budget scenario. Still, we’d like to see them take a look at that formula.”
“I think this is an enormous leap forward,” said state Sen. Jo Comerford. “Hopefully, what comes out of it is a new PILOT formula that adequately honors western Mass and north-central Mass communities. I always hear people say, ‘It’s never going to happen.’ But there is such a thing called ‘hold harmless.’ We can hope to hold those communities harmless and then any time we get more money for PILOT, and we can dedicate it to those communities.”
Comerford said eastern Mass doesn’t need to be hurt in order to help western Mass towns.
“We must re-do the formula,” she added. “The formula is harmful and it has been harmful for far too long. It’s insulting to western and north-central towns, and it has shortchanged us in every way we can think of.
Greg Vine can be reached at gvineadn@gmail.com.