Thursday, February 7, 2013

Payment in Lieu of Taxes …PILOT


Payment in Lieu of Taxes …PILOT

There has been much discussion on the blog about following the DOR recommendation and formalizing the PILOT paid by the Light department. Bev has unearthed some interesting information about Chapter 164A ( New England Power Pool) in addition to Chapter 164 (Manufacture and Sale of Gas and Electricity)

Section 8 of Chapter 164A specifically in subsection C:

From Chapter 164A section 8
(c) There is hereby imposed on each municipal electric department an annual payment in lieu of taxes equal to the then equalization percentage of (A) the original cost less depreciation of its direct ownership interest in electric power facilities located within the commonwealth,
excluding any portion thereof represented by any investment by others as described in (B), and (B) in the event a municipal electric department has an interest other than direct ownership described in (A), the amount of its investment less any amortization thereof through ownership of securities, prepayment or similar arrangements in such facilities under this chapter, all as at the end of the municipal electric department’s last fiscal year. The equalization percentage shall be determined by the commissioner of corporations and taxation on or prior to July first of each year and shall be the percentage resulting from the fraction, the numerator of which shall be the aggregate amount paid in the preceding calendar year by all domestic electric utilities which are not municipal electric departments for franchise taxes paid to the commonwealth, plus any other taxes not covered by subsections (b) or (d) of this section paid to the commonwealth or any subdivision thereof and the denominator of which shall consist of the aggregate amount of net utility plant, as of the end of the preceding calendar year, of all domestic electric utilities which are not municipal electric departments; the amount of said taxes and net utility plant to be obtained by the commissioner from the annual reports for said preceding calendar year filed with the department of telecommunications and energy by said domestic electric utilities. If such taxes are reported for a period other than the calendar year, or if such net utility plant is reported as of a date other than the end of a calendar year, the commissioner shall use such period or date as is reasonable and practicable with such adjustments as may be necessary to carry out the purposes of this section. In the event a municipal electric department uses a fiscal year longer or shorter than twelve months, the commissioner shall appropriately adjust the payment to be made under this section. Such payment is to be in lieu of a tax upon the franchise of the municipal electric department to own or operate directly or indirectly such electric power facilities and is to be in accordance with the following provisions:
(1) Every municipal electric department subject to this section shall annually, on or before the fifteenth day of the third month following the close of its fiscal year, make a return to the commissioner of corporations and taxation sworn to by its manager, a majority of its commissioners, or in their absence or incapacity by any other principal officer, in such form as said commissioner with the approval of the state tax commission shall prescribe, stating such information as said commissioner may require for the determination of the payment imposed by this subsection. Said payment shall be due and payable on or before the due date of the return.

(2) All provisions of chapter sixty-three relative to the assessment, collection, payment, abatement, verification and administration of taxes, including penalties, applicable to domestic business corporations, as defined in section thirty of chapter sixty-three, shall, so far as pertinent, be applicable to payments under this subsection.
(3) All revenue collected under the provisions of this section shall be credited to the General Fund.
(d) In connection with all sales, use, excise and other taxes imposed with respect to electric power facilities, materials included or to be included therein, or energy produced thereat and sold at wholesale therefrom under authority of this chapter, by any laws of the commonwealth and not covered by subsections (b) and (c), a municipal electric department participating in an electric power facility by ownership, prepayment or contract for purchase of capacity and related energy from a specifically identified generating unit shall be subject to payments in lieu of such taxes in the same manner and under the same procedures as a corporation defined as an “electric company” in section one of chapter one hundred sixty-four is subject to such taxes and shall be limited to only those exemptions as are available to such a corporation.

(e) Legislative consent is hereby given to the application of the laws of other states with respect to taxation, payments in lieu of taxes, and the assessment thereof to any domestic electric utility which has acquired or has an interest in an electric power facility, real or personal, situated without the commonwealth, or which is owning or operating electric power facilities without the commonwealth pursuant to authority granted in this chapter.

What was that? There is a MGL with the PILOT payment calculation already in effect? Probably should look for this “commissioner of corporations and taxation” individual….maybe get some guidance. Oh yeah, we’re going to need the accurate financial data from the correct fiscal year in order to CALCULATE a PILOT payment. I see some math equations in our future. Maybe the DESE can add this type of question to the 10th grade MCAS exam.


Good work Bev! Now we need to locate this “commissioner of corporations and taxation”. Maybe the BOS can ask the State Auditor’s Division of Local Mandates for some help in this matter. Can the town look at prior years? Very interesting!

My opinions…supported by FACTS ! ! !

Julie Farrell

15 comments:

  1. You just have to love it!! There is no "we will give you what we feel like giving you" There is no "we will give you a junk truck, as part of the payment!!" That crap does not fly. I would love to see these guys, have to make back payments. Am I being unreasonable? No, I do not think so. We have been played for fools, and I am sick of it. The elderly, people with taxes, house payments, kids to cloth and feed are able to make payments. There is no reason our Municipal Light and Water can not do their share. If our water department is in such bad shape, they need to make cuts in their administration, and not give out raises. Do you think that will happen?? Bet they don't. Things continue to be getting worse for the people at the water and light. Whats that old saying? What you do comes back to you!! Bev.

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  2. So like this is a law? Like you have to follow the law or you get in trouble kind of law?

    So your asking light dept. to follow the law?

    Isn't that ridiculous!

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  3. Templeton has been short changed by millions and with the help of the many that go to L=W meeting it is being brought to light,no pun intended! The facts are that the General Mgr. has a problem with managing the finances and spending for the richest department in town!I would like to see the pilot double now and double again in the neat year. We can get them to do that one way or another. The petition is the first order of business and then with some leagal help and the law presentation to them by the new authority they will probably get the message? Will the union get a big raise or will the department feel like the rest of Templeton does,Broke!
    Hope they have a sense of whats going on and don't make us do the most drastic of ideas!
    But thats a option also!
    lets get the word out and start getting the fair share Templeton has been swindled from for a long time.
    Shareholder
    Dave Samrt

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  4. I went around the web and looked at other municipal light plant websites to see what to compare ours to. ALL of them were so proud to be MUNICIPAL light plant and bragged about the savings and benefits they provided to their community. They even promoted community projects they've sponsored. It was like seeing in color for the first time. I am SHOCKED that our light plant has gotten away with the management and the poor treatment of their customers/shareholders. But, hindsight is 20-20. I'm glad people like Bev and Dave and Julie are constantly researching and looking out for their town by digging deeper into issue that have big question marks. And, again...has the missing annual report ever been resubmitted? Does the town and/or Advisory Board possess accurate annual reports from the l&w dept for the past 5 years? I, too, would like to know if the town can go after past PILOT payments that we were legally supposed to receive. Wow! You can't make this stuff up.

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  5. We the voters can and i think we will change the way business is done at light and water. The fact that there are all kinds of info and we have found the proof they have violated is in the favor of the changes we plan to make. Driscoll is a very slow and non productive manager and needs to be monitored very close, the reason i say that is very clear, I can name 5-10 things that are a very important issue for us all and with great effort we now have almost 15% of an audit,no web site ,lack of reclosers, wow is the Templeton light and water a poor excuse of a municipal departmental monopoly, They don't give a rats ass for the town unless it is to do with money and benifits them and there exsistance. The comment over the street lights that edwards made shows the town people that walk and their kids, that when the lights are positioned to help traffic thats more important then the sidewalks/crosswalks
    being better lighted. The Cleaning comment about the sidewalks was a shot over the bow and useless Greg! Bad move, You'll pay for that one, Maybe a bylaw change to have residents clean the sidewalks needs to be looked at on your behalf. You were the only one commissioner that was i thought for the people, Guess the Dana in you has come out?
    You give me food for thought and will press for resolve and results even harder. Dana "low blow" the camera move to the back thing? who made any complaints about it and who is the real problem? LOOK IN THE MIRROR! YEA IT'S YOU TOO.
    The facts are out there and we at C4T will get them to you!
    Happy to help better Templeton,
    Shareholder
    Dave Smart

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  6. For all of you that do not remember when the light dept was led by Mr Houghton, Mr Kwazny, Mr Demek the light dept worked for the town. Then along came Gerald Skelton and his buddies Dana Blais and Sean Hamilton got on the commission ( yeah did you all for get Sean H was a commissioner before he became the manager when Skelton retired. can everyone say nepotism. ) then they started padding their pockets. padding salaries and pensions Time for the BS to stop - time to take the light & water dept back to the town.

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  7. Dana and Driscoll keep saying that if they are to pay the town more, they will have to charge the ratepayers more. The Pilot should be paid first like ones taxes then any extra would go for raises, new equipment etc. so no Dana more pilot to the town should not be passed on to the rate payers. We elected you all commissioners so start working for us. you too VW

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    1. Some how these guys have gotten things very backwards. They will rue the day they did not do the right thing and help the town, when they had the means! When the cat is out of the bag, there is no getting it back in. JD may know a lot about electricity, but he does not know crap about how to manage people. It seems, this is the culture over on Bridge Street. If I am figuring things right, there will be big changes in the future. See, greed will get you in the end. My opinion, Bev

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  8. I have said it before....I am saying it again.
    Driscoll needs to be FIRED !!!! End of Story. period. Someone from T4C should get elected to the board, then next year do the same, then a majority should give Driscol an ACTION PlAN to shape up or SHIP OUT. The commission DOES have that authority.

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    1. I think JD is guilty of being a follower. I am willing to bet he never managed a company before. That fact, along with having no one to follow once he got here, has us in this mess. GS's way to manage, was to pay for loyalty. Long term it worked for him, but it did nothing to help the people he was working for. Somehow he missed that part, and it took to long for us to figure out what was going on. You are very right about JD, but just getting rid of him will not solve our problems. Bev

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    2. Seems to me Driscoll isn't necessarily the whole problem. His attitude could be better towards customers for sure. But, if he had commissioners that gave him better and proper direction, a lot of this mess wouldn't have happened. Abolishing Ch. 93 seems more like what needs to happen. I know it will take a while. But restoring the light dept back to a point when it was run properly seems the way to go. But what do I know? I'm just a stupid taxpayer.

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  9. Any truth to the rumor that Jerry will lose his pension if the BOS "take over" Light and Water? Something about 220CMR 149 or 149....

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  10. bev, maybe it won't solve the problems, but it is one hell of a good start !!!!! as i mentioned the other day, "when people fear government there is tyranny!! when the government fears the people there is democracy!" t jefferson........it's about time gs and friends start to fear people.......

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    1. Yes 1:43 you are right! As far as I know Jerry will not loose his pension. He could also loose any respect people have for him, OH DAM, {as Jeff Bennett would say}, that has been lost for a very long time, what was I thinking???lol, Bev.

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  11. Are you sure about the pension? I think that CMR is right about the pension.

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