August 03, 2020

Pittsfield, MCI tax dispute still unresolved

PITTSFIELD — A two-year tax dispute between the town of Pittsfield and Maine Central Institute remains unresolved, despite payment of the 1990 taxes and mediation.

MCI Headmaster Doug Cummings said that the opinion issued from the mediation conducted by attorney Albert L. Bernier is being reviewed further.

“It had some excellent points, but there are still things to be resolved,” Cummings said.

The opinion concluded that the town and its tax assessor had no authority to issue a contract in 1978 exempting selected MCI properties from taxation.

The contract was issued in exchange for MCI-owned property on Main Street that the town wanted in conjunction with downtown revitalization.

The properties, primarily those including employee housing, remained exempt until a revaluation of Pittsfield properties in 1990. Since 1990, the town has maintained that MCI owed more than $12,000 in taxes. In 1991, another bill of $11,106 was issued.

To protect the properties from acquisition through the lien process, MCI paid the 1990 taxes in late November while mediation was in progress.

Bernier pointed out in his written opinion that the contract exempting properties was void when it was issued. Because of that fact, he says, MCI is entitled to compensation for the value of the Karam property that was conveyed to the town, and interest that would have accrued on that value in the interim.

In addition, Bernier said, MCI is entitled to an abatement for the portion of the property that is not occupied as rental housing.

Bernier also points out that MCI was entitled to its tax-exempt status in 1978, with the exception of the golf course on Hartland Avenue, because the law excluding school employee housing from taxation changed after the 1978 contract.

Determining the value of the property and the interest due the school is one issue to be resolved, Cummings said, if in fact the contract is considered invalid. School officials question the validity of the contract.

In taxing the employee housing, Pittsfield’s tax assessor maintained that portion of the school’s property did not constitute real estate or personal property used solely for literary and scientific purposes.

Cummings maintains that the role the housing plays in the operation of the school is in keeping with the overall mission of the school. Housing is not offered as a benefit, but rather as a requirement, he said.

“It’s a hard issue for people to understand. Most people don’t work where they live. But dorm parents have to be available 24 hours a day. Someone has to be on duty and it is required they live here,” he said.

Taking his own residence as an example, he said, “Yes, it’s where I live, but that house is used for far more than my residence.”

To resolve the dispute, Cummings said that abatements on the residences need to be discussed.

The final issue in dispute is the taxable status of MCI’s Johnson W. Parks Golf Course. The trust that established the golf course stipulated that the land be developed for the youth of the community in a recreational way, Cummings said.

Current MCI policy allows its students to play at the course at no charge. In addition, the school maintains a low fee for college students and younger students.

“You would be hard pressed to find a municipal course that offers that type of opportunity,” he said. “It is a revenue-generating facility and it needs to fund itself, but its general purpose is as a recreational space for the youth of the community.”

The estate where the golf course is located also includes the Pinnacle Ski Slope that is used by the town as a winter park, and is operated by a non-profit club.

In addition, the land on the estate is being used more and more for educational purposes as restructuring finds students doing more learning activities. This year, the biological and geological survey work from the school’s science classes made use of the property.

Cummings is confident that the issue can be resolved. Pittsfield Mayor Robert Downs and MCI trustee Allyn Taylor are the primary negotiators.

“Whatever they agree on, I will be very comfortable with,” Cummings said. “They each represent a given group and both are very concerned that both parties get out from under this issue without a scar.”

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