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Appeals Court of Massachusetts.



Decided: February 10, 2021

By the Court (Meade, Milkey & Neyman, JJ.1)


As of January 1, 2007, Lexington August Realty Trust (taxpayer) owned an eleven acre parcel of vacant land (lot 6A) in Lexington, Massachusetts. For fiscal year 2008 (FY2008), the Lexington board of assessors (town), issued the taxpayer a $169,788.17 property tax bill for lot 6A. Even though the property was zoned for residential use, the town classified it for tax purposes as commercial property. After the town denied the taxpayer's abatement application, the Appellate Tax Board (board) ruled on appeal that lot 6A should have been classified as residential. A significantly lower tax rate applied to residential land, and the board therefore granted the taxpayer an abatement of $79,866.02. Before us now is the town's appeal of the board's decision. The taxpayer also cross-appealed, challenging the value at which the town assessed lot 6A. Finding insufficient merit in both appeals, we affirm the board's decision in its entirety.

Background.2 Lot 6A formerly was part of a much larger tract of land -- over one hundred acres in size -- that had been the site of the long-defunct Middlesex County Hospital. “Approval not required” (ANR) plans dated 1996 and 2002 identified lot 6A as a separate developable lot. In 2006, the taxpayer purchased lot 6A for $4.1 million in order to build a housing development there (and on an adjacent parcel that the taxpayer already owned). In fact, under applicable zoning, lot 6A could be used only for residential purposes as a matter of right, with limited exceptions not here relevant.3 Even with a special permit, only certain commercial uses, such as golf courses, could be allowed there.

Nevertheless, for FY2008, the town classified lot 6A as commercial property. The assessor specifically assigned lot 6A a so-called “use code” as a private hospital even though no such use was allowed in a residential district. After assessing its value at $6.976 million, the town taxed lot 6A at the commercial rate and issued the taxpayer a $169,788.17 tax bill.4 This prompted the taxpayer to request an abatement, which the town denied.

On appeal to the board, the taxpayer challenged the town's classification of lot 6A as commercial land, and it argued that the town had inflated the lot's value based on an untenable commercial use. Because only two single-family homes could be built on lot 6A as a matter of right, the taxpayer claimed that the property's actual value was between $500,000 and $600,000. The board agreed that lot 6A should be classified as residential,5 but rejected the taxpayer's arguments about how much the lot was worth. Applying the residential rate to lot 6A's assessed value, the board granted the taxpayer an abatement of $79,866.02. Both sides appealed.

Discussion. 1. Town's appeal. Section 2A of G. L. c. 59 was enacted to create a uniform use-based property classification system to promote fair apportionment of the tax burden among property owners according to the economic benefits derived from their properties. See McNeill v. Board of Assessors of W. Springfield, 396 Mass. 603, 606 (1986) (“The underlying rationale of classification is that the commercial and income-producing property owner pays more for local taxes because he receives more economic benefits from the community”). Although the town initially assigned lot 6A a “use code” for a private hospital, it argued to the board, and now argues to us, that lot 6A must be classified as commercial property for FY2008 on different grounds. Specifically, the town argues that pursuant to § 2A, regardless of whether undeveloped land is zoned only for residential use, it can be classified as residential land only after it formally has been subdivided pursuant to the subdivision control law, G. L. c. 41, §§ 81K-81GG.6 We are unpersuaded.

Under the express terms of § 2A, “land that is situated in a residential zone and has been subdivided into residential lots” properly can be classified as residential property. G. L. c. 59, § 2A (b). As the town acknowledged at oral argument, the Legislature intended this provision, at least in part, as “a break given to developers who are well on their way to constructing a residential development.” The term “subdivided” is not defined in the statute, and therefore we apply the rule that undefined terms are to be given “their usual and accepted meanings, as long as these meanings are consistent with the statutory purpose.” Steege v. Board of Appeals of Stow, 26 Mass. App. Ct. 970, 971 (1988). By the key date of January 1, 2007, lot 6A had been demarcated on two ANR plans, and it had been broken off from the larger parcel and sold to the taxpayer as a separate developable lot. Moreover, as noted, lot 6A was zoned for residential use, and the taxpayer was in the process of seeking to develop it for that purpose. Under these circumstances, the board found that lot 6A qualified under § 2A as residential property that had “been subdivided.” We discern no error in that conclusion. See D&H Distrib. Co. v. Commissioner of Revenue, 477 Mass. 538, 544 (2017), quoting Attorney Gen. v. Commissioner of Ins., 450 Mass. 311, 319 (2008) (“substantial deference” owed “to the board's reasonable interpretation of tax statutes”). See also Raytheon Co. v. Commissioner of Revenue, 455 Mass. 334, 338 (2009) (board's expertise “is also given weight when mixed questions of fact and law are considered”).

To be sure, the town is correct that the term “subdivided” is used in a narrower sense in the context of the subdivision control law, under which ANR lots are excluded from the regulatory provisions of that act. See G. L. c. 41, § 81L (“subdivision” is “the division of a tract of land into two or more lots,” except with respect to ANR lots); RCA Dev., Inc. v. Zoning Bd. of Appeals of Brockton, 482 Mass. 156, 159–160 (2019).7 However, the subdivision control law has nothing to do with the taxation of property; its aim instead is to ensure safe, convenient, and adequate access to public ways within subdivisions. See G. L. c. 41, § 81M; LeBlanc v. Board of Appeals of Danvers, 32 Mass. App. Ct. 760, 763 (1992). We therefore see no compelling reason why the board was bound to interpret the word “subdivided” identically with how that term is used in the subdivision control law. In reaching this conclusion, we acknowledge that in discerning the meaning of the agricultural use exemption in a zoning bylaw, we have looked for guidance to the definition of agricultural land set forth in a tax statute. See Steege, 26 Mass. App. Ct. at 971. However, neither Steege nor the cases on which it relies require us woodenly to incorporate technical definitions from one statute into an entirely different one. See generally Oxford v. Oxford Water Co., 391 Mass. 581, 588 (1984), quoting Commonwealth v. Welosky, 276 Mass. 398, 401–402 (1931), cert. denied, 284 U.S. 684 (1932) (“Statutes are to be interpreted ․ to the end that they be held to cover subjects presumably within the vision of the Legislature and ․ be not stretched by enlargement of signification to comprehend matters not within the principle and purview on which they were founded when originally framed and their words chosen”). In sum, the board did not err in concluding that lot 6A should be classified as residential land for FY2008.8

2. Taxpayer's appeal. A property's value is assessed based on what a willing buyer and seller (each under no compulsion) would agree upon as a fair price in an arm's-length purchase and sale. General Elec. Co. v. Board of Assessors of Lynn, 393 Mass. 591, 608 (1984). To prevail, the taxpayer must show that the board lacked any legal or factual basis for concluding that the taxpayer did not meet its burden of proving the $6.976 million assessment exceeded lot 6A's fair cash value. D&H Distrib. Co., 477 Mass. at 544. The taxpayer could have met its initial burden in two different ways: “either [(1)] by exposing flaws or errors in the assessors’ method of valuation, or [(2)] by introducing affirmative evidence of value which undermines the assessors’ valuation.” General Elec. Co., supra at 600, quoting Donlon v. Board of Assessors of Holliston, 389 Mass. 848, 855 (1983). We address these pathways in reverse order.

The record provides ample support for the board's clearly-articulated reasons why it did not credit the taxpayer's evidence of value. See General Elec. Co., 393 Mass. at 600, 608, quoting Boston Edison Co. v. Board of Assessors of Watertown, 387 Mass. 298, 302 (1982) (this court “defer[s] to the board's judgment as to what evidence to accept and which method or methods of valuation to rely on”). In addition, there was strong affirmative evidence to support the town's assessed value. For example, the taxpayer had purchased the far smaller adjacent lot in an arm's-length transaction for $5.61 million.

Whether the taxpayer was able to demonstrate a defect in the town's valuation methodology presents a somewhat more difficult question. Although the town's director of assessing testified before the board, his testimony shed markedly little light on how specifically he determined the market value of lot 6A.9 Had the burden been on the town to justify the valuation methodology it used, then whether the town's showing was adequate would have been in significant doubt. See General Elec. Co., 393 Mass. at 600 & n.4. However, “[u]ntil the taxpayer sustains his burden [of proof], the valuation made by the assessors will be presumed valid.” Foxboro Assocs. v. Board of Assessors of Foxborough, 385 Mass. 679, 684 (1982). On the current undeveloped record, the taxpayer has not carried its burden of proof to show that the town's methodology may have resulted in overvaluation. See General Elec. Co., supra at 607–608. In sum, we discern no error of law and find nothing in the record that compels a reversal and remand. See Tennessee Gas Pipeline Co. v. Board of Assessors of Agawam, 428 Mass. 261, 262–263, 267 (1998).10

Disposition. The board's decision is affirmed.

So ordered.


2.   The parties agree on the essential facts, and we summarize them as set forth in the written findings of the board, supplemented by evidence in the record as needed.

3.   The town emphasizes that the zoning bylaw allows some nonresidential uses by permit, such as schools and churches, but fails to mention that, by statute, such uses generally are exempt from zoning restrictions. See G. L. c. 40A, § 3.

4.   The taxpayer proceeded to develop lot 6A and the adjacent lot after receiving two approvals from the town planning board later in 2007: a special permit to construct nineteen single-family homes, and an approval of a definitive subdivision plan pursuant to G. L. c. 41, § 81O. The town apparently has reclassified lot 6A as residential in subsequent years, and only the tax bill for FY2008 is in dispute.

5.   The board initially accepted the town's classification of lot 6A as commercial property. However, after the taxpayer noticed its appeal and the board therefore was called upon to issue its findings of fact and report justifying its position, the agency changed course. We discern no merit in the town's argument that the board had no authority to reconsider its ruling sua sponte. See Soe, Sex Offender Registry Bd. No. 252997 v. Sex Offender Registry Bd., 466 Mass. 381, 395–396 (2013) (administrative agency generally enjoys inherent power to revisit its decisions to ensure justice is done). We add that the board's decision was not final until its written findings of fact and report issued. New Cingular Wireless PCS LLC v. Commissioner of Revenue, 98 Mass. App. Ct. 346, 352 (2020), citing G. L. c. 58A, § 13.

6.   It is uncontested that although lot 6A and its adjacent parcel eventually were subdivided pursuant to the subdivision control law, that approval did not occur until a few months after the January 1, 2007 assessment date.

7.   ANR lots are excluded from the subdivision approval process because they already have adequate frontage along a public way. G. L. c. 41, §§ 81L, 81O.

8.   Even if the town were correct that lot 6A did not fit within the residential use class, it would not necessarily follow that the town was required to classify it as commercial property. The statute defines commercial property as “property used or held for use for business purposes and not specifically includible in another class.” G. L. c. 59, § 2A (b). The town interprets this language as meaning that property that does not expressly fall into other categories must, by default, be considered commercial property, regardless of whether such land was being used or held for business purposes. For present purposes, it suffices to say that other interpretations of the statutory language are reasonable. See D&H Distrib. Co., 477 Mass. at 544.

9.   Although the record reveals that the town initially assigned lot 6A a classification code for a private hospital, nothing in the testimony of the town's director of assessing indicates that this played a role in the value the town placed on the property. In any event, the board's decision accepts that lot 6A's highest and best use was for multiple single-family homes (the use to which the property in fact was put).

10.   To the extent the defendant's and the plaintiff's other arguments have not been explicitly addressed, “they ‘have not been overlooked. We find nothing in them that requires discussion.’ ” Commonwealth v. Brown, 479 Mass. 163, 168 n.3 (2018), quoting Commonwealth v. Domanski, 332 Mass. 66, 78 (1954).

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