SJC hears Hawley nonprofit tax case

Ruling could have broad implications

HAWLEY — A nonprofit foundation with 120 acres of Hawley forest land went before the state Supreme Judicial Court Monday morning to appeal a ruling that it must pay town taxes — because public access to the land was not promoted and therefore the foundation does not meet criteria for a tax-free “charitable” status.

The case of the New England Forestry Foundation Inc. versus the Hawley Board of Assessors is being watched by several land conservation groups that fear a final court decision in favor of Hawley could hamper future land preservation efforts in the state, and could set a precedent for cash-strapped towns seeking new revenues.

The high court now has up to 130 days to either uphold or overturn a 2011 Appellate Tax Board ruling that determined Hawley was within its rights to assess the Forestry Foundation a tax of $173 for its land holdings — which is still a tax break under the state’s Chapter 61 forestry conservation statute. David Martel, a lawyer for the Board of Assessors, says the fair-cash value of the land is $96,000. The land is located in West Hawley, at the end of a dead-end, dirt road, Stetson Road.

“We did already win the case theoretically, at an Appellate Tax Board hearing about two years ago,” said Assessors Chairman Henry Eggert. “The whole basis of our request was that (the land-use) was not charitable. They were cutting wood on that land, and sold it at a presumable profit.”

“They have never posted anything at the Town Office that the land was open to the public or to townspeople,” Eggert added. “The whole basis of our request was it was not a charitable use of land. We did not see that — nor did the Appellate Tax Board.”

“Even the state, which owns 45 percent of the land in Hawley, pays us Payment in Lieu of Taxes,” Eggert said.

In a state Supreme Court document, New England Forestry Foundation (NEFF) argued that state law exempts from taxation real estate owned by a “charitable organization and occupied ... for the purposes for which it was organized.”

“NEFF ‘occupies’ the forest by protecting it from development, and actively managing it in accordance with an ecologically sustainable and conservation-oriented forest management plan,” the Foundation said.

The brief goes on to say that the Hawley assessors’ public-access requirement “lacks any discernible basis in case law” and “reflects an impermissible intrusion by the ATB (Appellate Tax Board) into the management of charitable conservation organizations.”

“A ‘public access’ requirement of the kind demanded by the ATB is often antithetical to the goals of charitable organizations like NEFF, which aim ... to protect and preserve delicate and geographically remote habitats in their natural state.”

In 2009, the foundation submitted a Charitable Tax Return to the assessors, for a Fiscal Year 2010 tax exemption for charitable purposes that included “the conservation and sound management of the region’s private and municipal forestlands.”

When asked for more information, the foundation said its charitable purposes included “protecting forest land throughout New England for the purposes of saving open space ... educating the public about the benefits of providing clean water, wildlife habitats, and recreational opportunities through forest-land conservation.”

The assessors denied the exemption in April 2010, and the Tax Board upheld the Hawley board’s decision.

In findings that were released last January, the Appellate Tax Board said the property, called the Stetson-Phelps Memorial Forest, had only two points of access: the one-lane Stetson Road and a gated, wooded road that runs from the Kenneth Dubuque State Forest. The appellate board said the Foundation “failed to prove that it had made sufficient effort to inform the public that the subject property was open to public recreation.” It said the entrance, at the end of a dirt road passing between private buildings, “appeared to be an extension of a private driveway. Moreover ... public availability was not well-marked with signs; in fact, the gate across its access and the lack of a paved driveway specifically discouraged public usage.”

The board further found that the property was not sufficiently publicized in its Community Forest booklet, and there was no information about the site on the foundation’s Website at that time.

Comments supporting New England Forestry Foundation’s arguments were filed by Nature Conservancy and Trustees of Reservations, two other nonprofit conservation groups with extensive holdings in rural parts of the state including Franklin County.

The Massachusetts Association of Assessing Offices filed a document of support for Hawley assessors. Executive Director Robert Ellia said, in a telephone interview, that there is a misunderstanding that towns will go after foundations that truly qualify for the state’s tax-free “charitable” status, if the decision favoring Hawley’s assessors is upheld.

“If (the decision) goes the other way, a precedent could be set that would have serious effects,” said Ellia. “I think you could end up with a lot of tax-exempt property that shouldn’t be.”

Assessors Chairman Eggert said the Hawley issue has nothing to do with “conservation” land. “It’s about ‘charitable’ land,” he said. “It’s about people who just let their land in town sit dormant and want it to be classified as tax-free ‘charitable’ when no charity was given.”

The Hawley forest land was purchased by the Forestry Foundation in 1999, and a sign was posted at the entrance, saying that the Foundation “invites respectful public visits.” The Foundation says the land is used by the public for hiking, hunting and snowmobiling. Eggert said the foundation has made more effort to promote the forest since last January’s tax board ruling.

Hawley is composed of 19,740 acres; that includes 8,700 acres of forest land owned by the state and another 2,700 acres that are classified as forest land and receive a drastically reduced tax rate under Chapter 61.

You can reach Diane Broncaccio at: or 413-772-0261, ext. 277

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