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Courts Side with Colleges in Case Over Denied Brownfields Tax Credits

A long-running, high-profile lawsuit originally filed in 2014 has finally ended with the Massachusetts Supreme Judicial Court (SJC) declining to overturn an Appeals Court decision in the colleges’ favor. By letting the prior decision stand, the three colleges – Boston University, Wellesley College, and Northeastern University – will receive millions of dollars of state Brownfields Tax Credits.

As Cooperstown has previously reported, the lawsuit originally was filed in 2014, after the Massachusetts Department of Revenue (DOR) denied applications filed by the colleges seeking Massachusetts Brownfields Tax Credits. The suit alleged that DOR changed its rules after the applications were submitted, then used the new rules as a basis for denying the credits.

DOR channeled President Nixon by arguing, in effect, that since the DOR Commissioner is responsible for interpreting the tax statutes then its decisions by definition are proper. The Superior Court judge did not agree with the state, finding in October 2015 that the DOR’s Directive was unreasonable and that the decision to deny the credits based on that Directive was “unlawful” and violated due process. The DOR then appealed that decision to the state’s Appellate Court in December 2015.

The Appeals Court considered the arguments and legal filings of each party through 2016 and deliberated for months thereafter, only releasing its decision in the final days of 2017, affirming the lower court’s ruling. DOR again pursued an appeal, but the SJC refused to hear the case, effectively ending the years’-long battle.

*Disclosure: Cooperstown Environmental LLC represented one of the plaintiffs in the case.

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