Menino's proposal, which was filed as part of his legislative package, would actually close two loopholes in property tax law. The loopholes exempt certain telecommunications and switching properties from paying property taxes.
According to Ron Rakow, commissioner of assessments for the city, the loopholes come from a court decision that was made in 1948. "The industry is changing rapidly," he tells GlobeSt.com, emphasizing that the decisions that were made 50 years ago are no longer applicable.
Rakow acknowledges that property taxes for certain telecommunications companies will go up as a result of the law, and he estimates that the city will generate between $15 and 20 million in tax revenue if the legislation is passed.
For instance, he points out, Verizon has $4.1 billion worth of equipment in the state but only pays property taxes on 46% or $1.9 billion of that. "More than half is not being taxed," he says, because Verizon is organized as a corporation. RCN, another telecommunications company, is organized as a limited partnership and does not qualify for the exemption.
Rakow emphasizes that the bill is not a "Boston-only" issue but affects nearly every city and town in the state, since they all have switching equipment. He adds that the Massachusetts Municipal Association, a lobbying group for the state's cities and towns, has come out in favor of the bill.
The bill was filed by state Representative Angelo Scaccia and is currently waiting for a hearing.
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