The city of Springfield, Massachusetts has won another legal fight in a now decade-long effort to collect a big tax bill from a large utility company.
The Massachusetts Court of Appeals has ruled against Eversource in its claim that Springfield has miscalculated the value of the utility company’s property – the poles, wires, transformers, and so forth that constitute the infrastructure that delivers electricity throughout the city.
In 2012, Springfield and other municipalities changed the formula used to assess the personal property of utility companies to calculate tax bills. Eversource sued, challenging each annual tax bill for the last ten years while paying at least half what is due as allowed by state law.
The sum the tax collector in Springfield says Eversource owes totals about $42 million. Each day it goes unpaid another $9,000 of interest is tacked on.
“It’s a bill that is owed and we’d like (Eversource) to pay the bill and in court, we’ve been proven right so far,” said City Councilor Tim Allen.
“Obviously, every legal challenge they’ve put up they’ve lost and it would seem to me at some point the legal challenges would stop, but it is really up to them,” he said.
An Eversource spokesperson said on Tuesday the company is “carefully reviewing the ruling and evaluating our options while working toward an equitable result for all.”
Allen and City Councilor Mike Fenton first sought to bring public attention to the Eversource tax case last summer. In August, the City Council unanimously passed a resolution calling on the company to pay up.
During a City Council committee meeting on a natural gas pipeline project, Fenton confronted Eversource officials.
“Please drop your case and pay your bills,” Fenton demanded.
Eversource spokesman Joe Mitchell said the company is challenging a valuation system it believes to be flawed and lacking in transparency.
“Because the taxes that we pay are ultimately reflected on the customers’ rates, it is our responsibility to challenge a municipality’s valuation if it is determined to be excessive,” Mitchell said.
As for Eversource being willing to work toward an “equitable result,” Springfield’s chief finance officer T.J. Plante said there is no incentive for the city to negotiate.
“The city of Springfield is not cash poor,” Plante said. “We are not in a situation where we are going to give away money that is owed to the city that goes toward services: police, fire, DPW, schools, all that stuff. We are not prepared to give any of that away just because they (Eversource) chose not to pay us.”
Eversource is a Fortune 500 company that had earnings of $1.2 billion in 2020.
