Property Tax Alert: Massachusetts

May 2008

For Massachusetts property tax purposes, a provider of wireless cellular telecommunications, or "cell phone" service, was not a "telephone company" entitled to central valuation of its property under state law. The taxpayer's wireless cellular telecommunications network is classified as a commercial mobile radio service (CMRS) and regulated, therefore, under the state's common carrier statute. Accordingly, most of the provisions of G.L.c. 166, which regulates telephone and telegraph companies, are inapplicable to CMRS providers. Instead, as a CMRS provider, the taxpayer is regulated under G.L. c. 159, which governs common carriers. Therefore, the language and structure of the regulatory statutes supports the conclusion that the Massachusetts Legislature does not consider CMRS providers such as the taxpayer to be telephone companies. Moreover, CMRS providers do not use the same physical infrastructure for the transmission of telephone calls as do traditional telephone companies and are not subject to the entry and rate regulations historically applied to such utilities. Furthermore, the taxpayer owns virtually none of the property that would make it eligible for central valuation. Accordingly, the more technical understanding of "telephone company," which excludes CMRS providers such as the taxpayer, was applicable in the case at hand.

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