March 23, 1983 Number 10

March 23, 1983 Number 10. Evelyn B. Murphy Secretary Office of Economic Affairs Room 2101 One Ashburton Place Boston, Massachusetts 02108 Dear Secretary Murphy: Your predecessor requested my opinion concerning the proper construction of G.L. c. 23B, §§1 1-15, relating to the Urban Job Incentive Bureau (the "Bureau"). The questions concern the Bureau's responsibility, under those statutory provi- sions, to certify the eligibility of certain business facilities for favorable tax treat- ment. Specifically, the following questions are posed: 1 . Is the Bureau required to determine, before exercising its authority to renew or extend a certificate of eligibility for a particular business facility pursuant to section 15 of chapter 23B, that said facility meets each of the requirements for certification established by section 13 of said chapter for the taxable year for which such renewal or extension has been requested? 2. If the answer to the first question is in the affirmative, can the Bureau nonetheless renew or extend the certificate of eligibility for a particular business facility for a taxable year during which said facility was no longer located in an "eligible section of substantial poverty," as required by section 13( 1), solely because, in the intervening period since the facility was initially certified or last had its certificate renewed or extended, the area in which the facility is located has ceased to qualify as an "eligible section of substantial poverty" as that term is defined in section 1 1(a) of chapter 23B'? ^ A^ noted above, this opinion is rendered Independently of your recent Commissions Regulations. 450 CM R 201 01 ti sci/ . the finality and validity of which remain pending. P.D. 12 111 3. Where must a facility be located to satisfy the location requirement for an "eligible business facility" established by chapter 23B? 4. Where must an eligible business facility draw its employees from, thereby creating or maintaining at least twenty per cent of its employees, but not less than five jobs, as required by section 13(2) of chapter 23B? I will respond to these inquiries in the order posed. In response to the first question, it is my opinion that before lenewing or extend- ing a certificate of eligibility under G.L. c. 23B. §15. the Bureau must determine that the facility in question continues to meet all the requirements set forth in G.L. c. 23B, §13. This conclusion is based on the language of the statute as well as its legislative intent. Under G.L. c. 63B, §§38E and 38F, favorable tax treatment is made available for an "eligible business facility, as defined in section eleven of chapter twenty- three E." General Laws chapter 23B, section 1 1(c), defines "eligible business facil- ity" as follows: a place of business . . . located in a city or town containing one or more eligible sections of substantial poverty or in a city or town contiguous thereto and for which a certificate of eligibility has been issued by the bureau .... A facility for which such a certificate is issued shall be deemed an eligible business facility only during the taxable year or as of the taxable status date to which such certificate relates, as provided in this chapter. (Emphasis added.) Thus, in order for a business facility to be "eligible," it must have been issued a current certificate of eligibility by the Bureau. This requirement is reiterated in section 15(b), which makes it clear that the initial certificate issued by the Bureau with respect to a particular eligible business facility may not extend beyond one taxable year. Thus, while section 15(c) permits eligiblity to be certified for a cumulative total of up to ten years, periodic renewal or extension is nevertheless required. Futhermore, section 13 itself is phrased in terms of continuing requirements. To be eligible, a facility must, generally speaking: (1) serve an area larger than the eligible section of substantial poverty which satisfies its location requirement; (2) create or retain in that section at least twenty percent of its employees, but not less that five; (3) provide an approved training or assistance program, as long as the Bureau determines this to be feasible, and assure employed residents of poverty areas opportunities for job upgrading and for entry into supervisory positions; (4) represent an expansion of employment opportunities for the relevant area. St. 1982, c. 658, added a fifth limiting factor based upon the date of acquisition of the property My conclusion that these requirements must be met with respect to each year for which a renewal or extension is sought is underscored by the language in sec- tion 13(3), permitting a relaxation of the training or assistance requirements of that paragraph if the Bureau determines that continuation of such a program is no longer feasible. By negative implication, this exemption contemplates that without 112 P.D. 12 the proviso the discontinuance of such a program would require the rejection of an application for a renewal or extension. Furthermore, the Bureau is authorized, by section 15(f), to revoke certificates "if there has been a material change" in the facts relevant to the requirements of section 13. This provision is a further indi- cation that a facility must, for continued eligibility, remain in compliance with the requirements of section 13. This interpretation is also consistent with the legislative intent underlying the Act. As a familiar general rule, a "statute must be interpreted according to the intent of the Legislature ascertained from all its words construed by the ordinary and approved usage of the language, considered in connection with the cause of its enactment, the mischief or imperfection to be remedied and the main object to be accomplished, to the end that the purpose of its framers may be effectuated." Commomvealth v. Galvin, 388 Mass. 326, 328 (1983), quoting Board of Educa- tion V. Assessor of Worcester, 368 Mass. 511,513 (1975). Considering the essential purpose of the Act, providing employment opportunities and job improvement to residents of areas of substantial poverty within the Commonwealth, see G.L. c. 23B, §12, it would make little sense to suggest that a corporation may satisfy the requirements of section 13 for one year only, but remain eligible for nine further years of favorable tax treatment in disregard of those requirements. Rather, the Act as a whole clearly appears to be directed at providing tax advantages only in exchange for continuing benefits to the Commonwealth. Therefore, it is my opinion that before renewing or extending a certificate of eligibility, the Bureau must deter- mine that the facility continues to meet the requirements of G.L. c. 23B, §13. One of the requirements set forth in section 13 is that a facility be located in or contiguous to an eligible section of substantial poverty. SeeG.L. c. 23B, §13(1). In response to the second question, it is my opinion that this particular require- ment must be satisfied at the time of each renewal or extension. That question arises from the observation that the economic conditions in the area in which the facility is located may change after the initial certification and thereby preclude eligibility in later years. Although such a change may occur for reasons beyond the control of the affected business, it is "a salient principle of statutory construction" that "the statutory language itself is the principal source of insight into the legislative purpose." Hoffman \\ Howmedica, Inc. , 373 Mass. 32, 37 (1977). A statute cannot be extended by construction or enlargement beyond its fair import, although a hardship or unintentional omission results. Mitchell v. Mitchell, 312 Mass. 154, 161 ( 1942). Although it might have been a stronger incen- tive to impose the location requirement for only the initial year, the Legislature has not done so. Furthermore, the location requirement is contained not only in section 13(1), but also in each of the other paragraphs of section 13. "Eligible business facil- ity" is expressly defined as a place of business which "'is located in a city or town containing one or more eligible sections of substantial poverty or in a city or town contiguous thereto." G.L. c. 23B, §1 1(c) (emphasis added). It would run con- trary to that definition to conclude that a facility could remain an "eligible busi- ness facility," due to once having been located in an area so defined, even though it is no longer so located. Significantly, the references to the facility location requirement in section 13 also are in the present tense. Therefore, it is my opin- ion that the Bureau may not renew or extend the certificate of a facility which does not continue to meet the location requirement of the statute. P.D. 12 113 The third question asks what, precisely, is that location requirement. This ques- tion arises because each statutory reference to the location requirement contains a slightly different phrasing.' Thus, this statute, like the one at issue in Mas- sachusetts Commission Against Discrimination v. Libert}' Mutual Insurance Com- pany, 371 Mass. 186 (1976), "in certain respects lacks precision and verbal consistency," id. at 190, and therefore must be given a "reasonable construction," consistent with the legislative intent. American Family Life Assurance Company V. Commissioner of Insurance, 388 Mass. 468, 473 (1983). Such a construction, in my opinion, leads to the conclusion that, in order to be eligible, a facility must be located in a city or town containing one or more eligible sections of poverty or in a city or town contiguous to such a municipality. Tax benefits, which are the reason a business entity seeks eligibility, are avail- able only with respect to "an eligible business facility, as defined in section eleven of chapter twenty-three B." G.L. c. 63, §§ 38E and 38F. Section 1 1(c) of c. 23B, in turn, defines the location requirement with clarity and precision: the facility must be located "in a city or town containing one or more eligible sections of sub- stantial poverty or in a city or town contiguous thereto." The other references to location, by contrast, appear to be more in the nature of shorthand references to the definition set forth in section 11(c). None of the paragraphs of section 13 appears to be intended to substitute a different defini- tion; they are, rather, each primarily directed to different requirements for cer- tification. Thus, for example, section 13(1) primarily requires that the area served by the facility be larger than the eligible section of substantial poverty. Section 13(2), similarly, is not directed at defining the facility's location but, rather, to requiring the creation or retention of jobs within a particular area. Sections 13(3) and 13(4) are further variations on this theme; section 13(3) establishes the necessity of a training or assistance program and of opportunifies for upgrading, and sec- tion 13(4) is directed principally to requiring that the facility constitute an expan- sion of employment opportunities rather than a replacement of an existing business. The references to location in each of those sections are secondary to the primary purposes of those sections and therefore are not intended to supersede the precise definition of the term "eligible business facility" contained in section 1 1(c). There- fore, 1 conclude that in order to satisfy the location requirement, a facility seek- ing certification must be located in a city or town containing one or more eligible sections of substantial poverty or in a city or town contiguous to such a municipality. The fourth question concerns section 13(2), which provides that a facility may not become an "eligible business facility" unless it creates or retains in the eligible section of substantial poverty in which it is located at least twenty per cent of its employees, but not less than five jobs. The question is whether such employees must be drawn from the eligible section of poverty itself or whether they may be drawn from some larger area. As discussed in response to the preceding question, 1 have concluded that the facility itself need not be located in an eligible section of substantial poverty. ' Section 1 1(c) provides that an eligible business facility must be "located in a city or twon containing one or more eligible sections of substantial poverty or in a city or town contiguous thereto." G.L. c. 23B. §1 1(c). However, section i3( 1 ) refers to the "eligible section of substantial poverty in which [the facility] is located or contiguous to" ; section 13(2) refers to "the eligible section of substantial poverty in which |the facility] is located"; section 13(3) requires training of residents of "the eligible section of subsianlial poverty in which such facility is located or contiguous to"; and section 13(4) refers to "the eligible city or town in which the facihty is located." 114 P.D. 12 However, in response to the fourth question, it is my opinion that this provision expressly requires that "twenty per cent of [a facility's] employees, but not less than five jobs" must be created or retained from the eligible section of substantial poverty itself. This conclusion is based on a literal reading of section 13(2). I also consider it significant that section 13(3) refers to the necessity that the employed persons be "residents"—defined in section 11(d) as domiciliaries of an eligible section of substantial poverty.^ In short, the statute draws a distinction between the area in which a facility may be located and the area from which a minimum number of employees must be drawn. The statutory language, which is the primary basis for construction, Hoffinan v. Howmedica, Inc., supra, provides clearly that the employees in question must be drawn from the eligible section of substantial poverty itself. G.L. c. 23B, §§13(2), 13(3). A broader interpretation of this requirement, which would permit such employees to be drawn from the entire city or town containing an eligible section of substan- tial poverty, would arguably serve the Bureau's purpose "to enlarge and improve the skills of the work force, especially those within urban areas containing sec- tions of substantial poverty." G.L. c. 23B, §12. However, although a statute should be construed to enable achievement of its purposes, United States Trust Company V. Commonwealth, 348 Mass. 378, 383 (1965), the legislative intent is to be ascer- tained primarily from the statutory language. Registrar ofMotor Vehicles v. Board ofAppeal on Motor Vehicle Liability Policies and Bonds, 1981 Mass. Adv. Sh. 415, 420. In my opinion, such an interpretation would conflict with the statutory language. To the extent that the statutory language limits the practical scope of the Act, such a limitation must be taken as part of the expression of the Legisla- ture's intent. Commonwealth v. Galvin, supra; Mitchell v. Mitchell, supra. Furthermore, although this requirement may limit the applicability of the Act with respect to facilities of substantial size, a looser construction could undercut the purposes of the Act by permitting eligibility even though residents of depressed areas were not being employed, trained, or offered opportunities for advancement by the facility. It is unlikely that the Legislature intended to permit a business facil- ity, in order to enjoy the tax advantages of the Act, to locate near an area of poverty but draw its necessary twenty percent of employees from those who were not resi- dents of that section. I therefore conclude that the twenty per cent requirement is met only by employ- ing residents of the eligible section of substantial poverty near or in which the facil- ity is located. Very truly yours, FRANCIS X. BELLOTTI Attorney General Moreover, the tax deduction provided by G.L. c. 63, §38F, applies only to the wages paid to "individuals domiciled in an eligible section of substantial poverty." This indicates a statutory purpose to confine that tax incentive to correspond to the benefit to the populace of the particularly poor sections them.selves, rather than to the broader urban areas containing such sections. P.D. 12 115 Number 11. April 11, 1983 William M. Shipps, Commissioner Department of Labor and Industries 100 Cambridge Street Boston, Massachusetts 02202 Dear Commissioner Shipps: You have requested my opinion as to whether there presently exists a right of appeal from your wage determinations under G.L. c. 149, §27A. For the reasons discussed below, I conclude that such a right of appeal does exist. The facts which gave rise to your request are as follows: On February 9, 1983, the Board of Selectmen of the Town of Rowe appealed, pursuant to G.L. c. 149, §27A, from a determination of minimum wage rates made by you on January 1 1 1983, for construction of a fire station in that town. • Section 27A provides, in per- tinent part, that certain interested parties "may appeal to the associate commis- sioners from a wage determination . . . made by the commissioner, by serving on the commissioner a written notice to that effect. Thereupon the commissioner shall immediately cause the associate commissioners to hold a public hearing on the commissioner's action appealed from. " However, you have informed me that you can no longer follow this appeal procedure because St. 1981, c. 351, §230, abolished the positions of "associate commissioner."^ Under these circumstances, you have asked whether you are required to hold a public hearing on the Town of Rowe's appeal and, if so, before whom such a hearing should be held. Essentially, your question is whether, by abolishing the positions of associate commissioner, the Legislature, in effect, eliminated the right to appeal wage determinations contained in G.L. c. 149, §27A. As a matter of statutory construction, I have concluded that the right of appeal contained in sec- tion 27A continues in effect, despite the abolition of the positions of associate commissioner. This conclusion is based, first of all, on the fact that St. 1981, c. 351, §230, amended only G.L. c. 23, §1, and did not directly amend G.L. c. 149, §27A, in any manner.^ Thus the appeal procedure set forth in G.L. c. 149, §27A, remains literally in place, including all references to "associate commissioners." Since G.L. c. 149, §27A, has not been expressly amended or repealed, each word should be given full effect if at all possible. See In the Matter of a Civil Investigative Demand Addressed to Yankee Milk, Inc., 372 Mass. 353, 358 (1977); Common- wealth V. Brooks, 366 Mass. 423, 428 (1974). Furthermore, the provision as a whole must be construed to be an effective piece of legislation. See Commonwealth V. Mercy Hospital , 364 Mass. 515, 521 (1974). Conversely, an interpretation ren- dering a statute meaningless is to be avoided. See Insurance Rating Board v. Com- missioner ofInsurance, 356 Mass. 184, 189 (1969); O'Shea v. Holyoke, 345 Mass. 175, 179 (1962). The Commissioner of Labor and Industries is required to set the minimum wage rate paid in the construction of public works. G.L. c. 149. §26, St. 1981. c. 351, §230 provides: Section 1 of chapter 23 of the General Laws, as most recently amended by section 8 of chapter 864 of the acts of 1977, is hereby further amended by striking out, in lines 4 to 6, inclusive, the words:— , and three associate commissioners, one of whom shall be a representative of labor and one a representative of employers of labor. It is notable that St. 1981 , c. 351, §231, also amended G.L. c. 23, §2, by abolishing each reference to "associate commissioner" contained therein. 116 P.D. 12 Another principle of statutory construction which is applicable here relates to repeal by implication. Since G.L. c. 149. §27A, has not been expressly repealed, any repeal would necessarily be by implication. Such repeals are strongly disfa- vored. T.J. Hartnett Beverage Co. v. Alcoholic Beverages Control Commission, 350 Mass. 619. 622 (1966); Registrar of Motor Vehicles v. Board of Appeal on Motor Vehicle Liability Policies and Bonds, 1981 Mass. Adv. Sh. 415, 420-21. In addition, it is also significant that St. 1981. c. 351, §230, was an outside sec- tion of a general appropriation bill.-* The policy disfavoring repeals by implica- tion is even stronger when the act from which a repeal is inferred is an appropriation act. TVA V. Hill,, 437 U.S. 153. 190 (1978); Preterm, Inc. v. Dukakis, 591 F. 2d 121. 131, 134(lst Cir. 1979). Given these principles, an analysis of G.L. c. 149. §27A. in conjunction with St. 1981 . c. 351 . §230, leads to the conclusion that the appeal procedure contained in section 27A remains effective. First, G.L. c. 149, §27A, is presumed to be effec- tive and not meaningless. Commonwealth v. Mercy Hospital, supra at 521 . Second, no express repeal exists here. Third, the presumption against repeal by implica- tion has not been overcome. T.J. Hartnett Beverage Co. v. Alcoholic Beverages Control Commission, supra. Section 230 of chapter 351 of the Acts of 1981 did only one thing: it abolished the positions of 'associate commissioner"' in the Depart- ment of Labor and Industries. Nothing in section 230 (or in its companion section 231) indicates in any direct or indirect manner that the Legislature intended to eliminate the appeal mechanism of G.L. c. 149. §27A. Rather, the legislative his- tory of that section indicates that its purpose, along with other outside sections of the same act, was to reorganize several departments and divisions (including the Department of Labor and Industries) into a "logical and more efficient structure." Mass. S. Doc. No. 2222 at 29-21 (1981). More fundamentally, the elimination of "associate commissioner" does not bear upon the principal thrust of G.L. c. 149, §27A, that is, to provide for review of minimum wage determinations. The fact that the "associate commissioners" are named as the hearing functionaries in section 27A is secondary to the principal purpose of that provision. In sum, St. 1981. c. 351. §230, does not repeal G.L. c. 149, §27A. either expressly or by clear implication. In addition, it is significant that G.L. c. 149, §27A. can be given full effect even though there are no longer any associate commissioners. One means of doing so would be to request the use of a hearing officer from the Division of Hearing Officers within the Executive Office for Administration and Finance to conduct hearings on wage determination appeals.'' Another means of effectuating G.L. c. * Such (lutsidc scclions to the general budget arc now prohibited. G.L e. 24. S7L. cis aim-ndal h\ St 1981 . e fi90. Comiwir (Jpiiiion of the JiisiHcs lo the House of Represaihilives. 1981 Ma>s. Adv. Sh. 2071,2077, ' General Laws chapter 7. section 4H. provides in pertinent part: Any officer or agency of the commonwealth authorized to conduct adjudicatory proceedings may . subject to the approval of the secretary of the executive office within which .such officers is employed or such agency is liK-atcd. request the division to conduct one or more classes of such proceedings or appeals on behalf of the officer or agency. The chief hearing officer may, subject to the approval of the secretary of administration and finance, grant any such request but shall, when neccs.sary, promulgate regulations governing the additional class orclas.scs of proceedings or appeals to be so conducted or heard prior to conducting or hearing any such proceedings or appeals. P.D. 12 117 149. §27A, would be to designate alternative hearing officers from within the Department of Labor and Industries.^ Such a designee should be someone who was not involved in the wage determination appealed from. See 4 B. Mezines, Administnitive Lciw, §§36.01 and 36.02 (5th ed. 1982). Alternatively, individuals could be hired from outside the Department to perform this function.^ In sum. it is my opinion that the right of appeal contained in G.L. c. 149. §27A. remains in effect. Very truly yours, FRANCIS X. BELLOTTI Atlornex General