Pelleverde Capital, LLC v. Bd. of Assessors of W. Bridgewater

• Decision Date: 21 September 2022
• Docket Number: 21-P-424
• Citation: 101 Mass.App.Ct. 739,194 N.E.3d 1286
• Parties: PELLEVERDE CAPITAL, LLC v. BOARD OF ASSESSORS OF WEST BRIDGEWATER (and two consolidated cases ).
• Court: Appeals Court of Massachusetts

101 Mass.App.Ct. 739
194 N.E.3d 1286

PELLEVERDE CAPITAL, LLC
v.
BOARD OF ASSESSORS OF WEST BRIDGEWATER (and two consolidated cases ¹ ).

No. 21-P-424

Appeals Court of Massachusetts, Suffolk.

Argued January 13, 2022
Decided September 21, 2022

Raipher D. Pellegrino, Springfield (Samuel R. Prickett also present) for the taxpayer.

Thomas P. Gay, Jr., for board of assessors of West Bridgewater.

Present: Rubin, Wolohojian, Blake, JJ.

WOLOHOJIAN, J.

In fiscal years 2015, 2016, and 2017 (tax years), PelleVerde Capital, LLC (PelleVerde) owned a solar photovoltaic facility (solar power facility) whose output went only to municipal properties used for public purposes in the town of West Bridgewater. During these tax years,² the Legislature exempted from taxation "[a]ny solar or wind powered system or device which is being utilized as a primary or auxiliary

194 N.E.3d 1288

power system for the purpose of heating or otherwise supplying the energy needs of property taxable under this chapter" (emphasis added). G. L. c. 59, § 5, Forty-fifth, as amended by St. 1978, c. 388 (solar exemption). PelleVerde sought personal property tax abatements for each of the three tax years, all of which were denied by the board of assessors of West Bridgewater (assessors). PelleVerde

101 Mass.App.Ct. 740

then appealed to the Appellate Tax Board (board), arguing that it was entitled to the solar exemption. The board affirmed the decisions of the assessors, concluding that the municipal properties supplied by PelleVerde's solar facility were not subject to taxation under G. L. c. 59 and, therefore, PelleVerde was not entitled to the solar exemption.³

Although we acknowledge that the statutory scheme produced a counterintuitive disincentive for solar power facilities to provide their output to municipal properties, we nonetheless affirm the board's decision. The Supreme Judicial Court has repeatedly held that municipal property used for a public purpose is exempt from taxation under c. 59; therefore, PelleVerde did not supply its output to "property taxable under [c. 59]," as required to obtain the solar exemption.

Background.⁴ During the three tax years at issue, PelleVerde owned a 1,868.24-kilowatt solar power facility located in West Bridgewater (town). Under a contract entered into with the town in 2011, PelleVerde sold all of the solar power facility's electricity or net metering credits to the town,⁵ which elected to allocate them to eight municipal properties,⁶ all of which were used for public purposes.⁷ The town did not assess real estate taxes on any of these municipally owned properties during the three tax years,

101 Mass.App.Ct. 741

and the assessors found that the properties were tax exempt.

Discussion. At issue is whether PelleVerde was entitled to an abatement of the personal property tax on its solar power facility under the solar exemption, which (as we have noted above), at the times relevant to this appeal, exempted from taxation "[a]ny solar or wind powered system or device which is being utilized as a primary or auxiliary power system for the purpose of heating or otherwise supplying the energy needs of property taxable under

194 N.E.3d 1289

this chapter," that is, under G. L. c. 59. G. L. c. 59, § 5, Forty-fifth, as amended by St. 1978, c. 388. The board construed the solar exemption to require PelleVerde to prove three things: (1) that PelleVerde's facility was a solar or wind powered system or device, (2) that it was utilized as a primary or auxiliary power system for the purpose of supplying energy, and (3) that it was utilized to supply the energy needs of property that was "subject to Massachusetts property tax." PelleVerde raises no quarrel with respect to the board's view of the first two of these requirements, which the board resolved favorably to PelleVerde. Instead, PelleVerde challenges in two respects the board's view of the third requirement. First, PelleVerde argues that the board did not hew to the statutory language, and instead impermissibly substituted the phrase "subject to Massachusetts property tax" for the actual statutory language "property taxable under [c. 59]." Second, PelleVerde contends that the municipal properties to which it supplied its solar facility's output were "property taxable under [c. 59]."⁸

We turn to this second argument first.⁹ In doing so, we keep in mind that "[a]ppellate review of a decision of the board is limited in scope." Schussel v. Commissioner of Revenue, 472 Mass. 83, 86, 32 N.E.3d 1239 (2015). "[W]e will not modify or reverse a decision of the board if the decision is based on both...