The only time telephone poles make the news is when a car leaves the road and crashes into one. Other than that, they have been so common for so long that they go unnoticed, almost too numerous to count.
Unless, that is, you're a city or town official looking for every possible source of revenue. Then those poles are like flakes of gold in a mine — start adding them up, and they're worth real money.
A provision of the state Senate budget now in conference committee would authorize municipalities to collect taxes on each and every one of the utility poles and wires within their borders.
The state's Appellate Tax Board ruled in 2007 that cities and towns could start collecting taxes on poles and wire installed on public property. The ruling was appealed, however, so the Department of Revenue told cities and towns not to spend the money until the case is settled.
Across the North Shore, the assessed value of poles and wires owned by Verizon amounts to nearly $68 million, worth a total of $818,000 in taxes in fiscal year 2008, the last year for which the Department of Revenue has estimates.
The state exempted utility poles from local taxes in the early 1900s to encourage the spread of telephone and telegraph service. At the time, Bell Atlantic was the only phone company in New England, and ownership of the poles passed to its descendent, Verizon, in 2000.
"We think, mission accomplished," said Geoffrey Beckwith, executive director of the Massachusetts Municipal Association, which lobbies on behalf of cities and towns in the state. Telecommunications no longer need incentives to install equipment, he said.
Verizon, however, sees it differently.
"Broadband networks represent critical pieces of our state's infrastructure," Verizon spokesman Philip Santoro wrote in a prepared release.
"Consumers and businesses want faster and ubiquitous broadband service, and that only happens through new investment. Massachusetts is a high-cost state, and new taxes will hinder new broadband investments."
Beckwith scoffed at the suggestion Verizon would stop investing in technological improvements because of the tax.
While Verizon owns the vast majority of poles in the state, Santoro said, some are owned by National Grid.
The state compiles data on the number of poles in each community from information supplied by the utility companies, said Department of Revenue spokesman Bob Bliss. The value of each pole is determined by its original cost, depreciated over time, Bliss said.
In Ipswich, the pole tax amounted to $103,000 last year and will be the same in the coming year. Town Manager Bob Markel isn't sure how the town would use the money if the Senate provision is passed.
One suggestion he made to selectmen some time ago was to issue a 20-year bond to pay for burying the utility wires on the North Green and in the downtown. Revenue collected from the pole tax could pay off the debt each year, Markel said.
Peabody stands to gain more than any other local community, about $147,000, according to the DOR figures. Mayor Michael Bonfanti said the Senate bill would "right a wrong," and that mayors statewide have supported the telecommunications tax for years.
"The exemption is no longer applicable," Bonfanti said.
With a city budget in excess of $130 million, $147,000 might not seem like a lot of money, but Bonfanti isn't about to check the teeth in this gift horse's mouth.
"Every little bit helps," he said.
Staff writer Steve Landwehr can be reached at 978-338-2660 or by e-mail at slandwehr@salem news.com.
tax potential by city/town
CommunityPole and wire valuationTaxes
Beverly$6 million$112,000
Boxford$4.4 million$48,000
Danvers$7.4 million$130,000
Hamilton$3.9 million$56,000
Ipswich$11 million$103,000
Marblehead$3 million$26,000
Middleton$2.2 million$22,000
Peabody$8 million$147,000
Salem$4.8 million$111,000
Swampscott$2.7 million$74,000
Topsfield$6.6 million$79,000
Wenham$2 million$27,000
Total$67.9 million$818,000
Source: Massachusetts Department of Revenue. Numbers are for fiscal year 2008.
