HAWLEY — Here, east is east, west is west and getting from one to the other means navigating your way through one of three state forests that dominate and divide this town.
Or leaving town temporarily to detour through Charlemont or Plainfield.
Even though the state has agreed to reconnect both sides of town by finally fixing Hunt Road through Kenneth Dubuque State Forest and allow Hawley to maintain it and other state-controlled seasonal roads, that will just add to the workload for a two-man road crew in a town that already feels squeezed by a state that pays only half what town officials say it should get for the 8,000 acres of state-owned land here.
For years, Hawley — a community of 400 where the state owns about 40 percent of the acreage — as well as other towns with heavy concentrations of state-owned land, have complained that they are being underfunded through the state’s Payments in Lieu of Taxes.
Those “PILOT” payments, have gone up and down through the years, following annual state budget appropriations and because of periodic adjustments made to the state program. A 2001 revaluation, for example — the first in 15 years — boosted payments in Sunderland and Wendell significantly but dropped PILOT amounts in Montague, Hawley and Warwick.
Hawley hasn’t been the only town to complain about the level of payments, which this year total $1.09 million in Franklin County, according to Department of Revenue data compiled by the recently formed Small Town Summit organization. The group termed PILOT “a critical financial issue for small towns in Western Mass.,” some of which have more than 50 percent of land that is tax-exempt, state owned or in Chapter 61, a reduced-assessment program for forest or farmland.
The $1.09 million total is about twice what it was in Fiscal 2000, although the state has also added about 1,000 acres since that time. Add those totals back to 2000, and it comes to $11,548,027 paid out.
Yet some towns, like Hawley, believe the Department of Revenue undervalues their state-owned land in its PILOT formulas, and that the towns should have been paid significantly more. And they are still looking for ways to boost that revenue.
“The state doesn’t fully fund these things,” says Charlemont Selectboard member Beth Bandy, who also coordinates Small Town Summit, as she looks over both PILOT payments and regional school reimbursements to the towns. “They’re subject to appropriation. These towns are really small, and don’t have the resources to go to Boston to advocate. We’re stuck right now. We’re really in a financial crunch.”
She adds, “If there’s a value for the state having these properties, the burden shouldn’t fall on these little towns out here.”
And while Hawley officials express appreciation for the Department of Conservation and Recreation for negotiating a fix for Hunt Road, which connects with Hallockville and Middle roads to create a direct, though unpaved, seasonal connection between East Hawley and West Hawley, they still express frustration at what it’s meant to have the state leaving them to run the town on a shoestring.
Rick Kean, a town assessor, says “In general, having so much land tied up in Chapter (61) and other conservation programs without proper reimbursement from the state is devastating. It results in extra-tight budgets and deferred maintenance of existing town assets. And because of the tax burden it places on our residents, it also paralyzes us when attempting to institute new programs that are instrumental to our development, like broadband.”
The state’s PILOT program, which dates back more than 100 years and has been revised numerous times in reaction to criticism of inequities.
Overall, payments to Franklin County towns with state owned land have remained stable over the past couple of years, after gradually increasing from $346,000 in 2003-4004. State Rep. Stephen Kulik, D-Worthington, said, “There have been ebbs and flows in interest over this issue. Lately, it’s been relatively quiet,” although Small Town Summit has included it on a list of legislative priorities.
“It’s a very complex thing, and it’s easy to get lost,” says Hawley Town Treasurer Virginia Gabert, as she pulls out the most recent state list of properties and valuations computed: 57 parcels, a total of 7,989 acres, valued by the state at $6.36 million, to be used in making PILOT payments in the budget year after next.
This year, the town received $63,513 from the state toward its $978,757 budget. But that, she adds, is based on the state appropriating 82 percent of the total allotment due, and that total allotment used a valuation that Gabert says is only 68 percent of the town’s assessed value for Department of Conservation and Recreation. There’s another 609 acres, part of the 7,989 acre total, that’s Department of Fish and Wildlife land, which she said is exempt from PILOT.
The $63,513 is half the $127,000 the town could be collecting on the land if it were privately owned, says Gabert, who did successfully challenged the state’s 2013 valuation, convincing the Department of Revenue that the valuation it had been using should have been doubled.
The Department of Revenue’s Bureau of Local Services adjusts valuations of state properties according to their taxable status at the time the commonwealth acquired them, the agency owning the parcels and their use, with discounts for size and the number of acquisitions in a particular holding.
A legislative change last year requires a once-in-four-year revaluation with a new adjustment formula.
Since Hawley, like most small towns, operates on a shoestring with part-time government, assessors don’t do their own valuations on state-owned land, and can rarely even respond to the state’s revaluation and how much land is considered primary buildable lots, or undevelopable, or residual land — a category including woodland.
“We have a week or 10 days to file a dispute if we don’t agree,” she said. “That’s not very much time in a town like Hawley, where selectmen meet every other week. So it could be between meetings, and all of a sudden, you’re out of luck.”
A state Bureau of Land Assessment official contends that the agency is more flexible than that, and that appeals on new valuations this month — they’ll be the base upon which payments are made in the next two years — can be appealed through July 20.
To further complicate the picture, Gabert said, the state discounts the value of its land holdings if they are in large blocks of more than 100 acres which, she points out, tend to be in western Massachusetts.
Assessor Henry Eggert reasons, “The more (state-owned) land you have, the more you need the PILOT.”
Towns like Warwick and Monroe, where state-owned land accounts for more than 50 percent of the town, have thousands of acres owned by the state. Hawley’s estimate of getting half of what those properties would bring in taxes could amount to millions of dollars for Franklin County as a whole.
In Hawley, where the decision to approach DCR over fixing Hunt and Middle roads only came about because of an island of privately held 90 acres the state wanted to buy in the middle of Dubuque State Forest.
“We said, ‘Wait: How can you spend money buying that private land when you haven’t spent money fixing the roads? You can’t even access the land,’” said John Sears, who was a selectman when the town was notified last year and negotiated the agreement for the state to repair the roads and for the town to maintain them.
“That’s going to add to the argument that we should be getting decent PILOT payments, because we’re helping maintain these roads through the state forests,” he said, shaking his head when asked if the town tried to negotiate for additional money to care for the forest roads.
“That will be our contribution,” he said, noting that not only will the town be burdened with the additional road work, it will also be losing about $1,200 a year in tax money to have the state buy the private land. “How crazy is that? (But) it’s the right thing to do. It’s the only way the road’s going to be maintained.”
With the state valuing its land roughly half what the town would, Hawley officials figure the hundreds of thousands in “lost” revenue over the years has hurt the town considerably.
“There are a lot of things we’d like to do that always has been put on the back burner, because of the lack of funds and a desire to not be raising taxes on people,” says Eggert. “We’d love to improve conditions here (at the tiny town office) for town meeting.”
Sears also points out that the Hawley firehouse has to depend on an outdoor chemical toilet and is too small to house one of the town’s fire trucks.
The town garage is located on a small parcel beside the Chickley River, adds Gabert.
“With all of the issues we had with (Tropical Storm) Irene, everyone from FEMA, from MEMA — everyone kept saying, ‘You should think about moving this building.’ We don’t have a place, we don’t have the money, we can’t afford that. We have no options. Additional state funding would be very handy.”
Not everyone agrees that the state is under-funding PILOT, though.
In Warwick, where the state owns about 11,650 acres, which it recently valued at $10 million, and contributed $110,899 in PILOT payments toward the town’s $1.89 million budget, according to assessors, Town Administrator David Young said that land can’t be easily developed. The state has paid more than what it would be worth as Chapter 61 woodland if it were privately owned, according to an analysis done a number of years ago by Assessor Beth Gilgun.
“I’m from the school of thought that says those lands don’t owe us as much in taxes, because they’re not going to put pressure on our schools, on the police department,” Young says. “I’m from the camp that thinks conservation easements and state-owned land, undeveloped land, is a good idea, because it limits development that doesn’t pay for itself. A new home, usually brings more expenses than revenue.”
“If you compare it with someone who owns land that’s not in Chapter 61, a potential building lot, yes, we get less,” says Young. “But were not asking for that kind of development.”
Warwick Assessor Keith Ross adds, “The biggest impact that I’ve seen over the past 40 years, is that you never know what you’re going to get from the state, so it’s really hard to plan. They may decide on their own to do a new valuation of all the properties, and we have no say or input in it whatsoever. It doesn’t matter what you say, they’re still going to pay what they want, based on what gets appropriated by the Legislature.”
While having lands set aside for recreation can benefit a town, there can also be costs if police or ambulance services are needed, he adds.
Sen. Adam Hinds, D-Pittsfield, says he’s heard from towns in his district, like Hawley, that what the state pays towns in lieu of taxes is part of “a scenario that’s not sustainable.
“We have towns where more than 50 percent of their land is in state hands, with a huge impact. We have small towns experiencing population decline and grappling with how do we balance budgets in this environment? We need to be very clear in ensuring the state is not complicit in creating these growing gaps throughout the commonwealth.”
Hinds, who says he and other members of the Legislature’s Rural Caucus are trying to convince the Baker administration for the need to develop a rural agenda that would address PILOT and other issues affecting rural towns.
“It’s a small amount of money in the big scheme of things and could be a game-changing contribution to how we ensure our small towns can survive,” he said.
“Hawley is a good example of a town that cannot grow,” Kulik adds. They’re almost stuck in terms of their developable land and their ability to attract new residents or business that want to locate there. I do think the state has some obligation to provide additional financial assistance and support for those kinds of communities, for limiting their potential.”
Back in East Hawley, Pond Road resident Kirby ‘Lark’ Thwing, who remembers going back and forth all the time to West Hawley over the road that began deteriorating when the state took over land for the forest, says that over decades, having so much state-owned land for which it’s paid as little as it is has cost the town, and shifted the taxpayers.
“Of course the town has suffered,” he says. “But we’re such a small town that we know that we don’t have a whole lot of voice. We keep reminding the state that it’s an issue, but we keep going forward with ‘How do we deal with the situation we have?’ rather that moan and complain about how we think it should be.” Kean, adds, “We like it here, we like living here. It would be nice if the state could help us out a little.”
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www.mass.gov/dor/docs/dls/bla/certstandards.pdf
Reach Richie Davis at: rdavis@recorder.com
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