FINANCE COMMISSION OF BOSTON vs. COMMISSIONER OF REVENUE & others. [Note 1]

LIACOS, J. The Finance Commission of Boston (commission) appeals from the judgment of the Superior Court, entered January 29, 1980, in so far as it denied the commission's motion to compel production of documents predating March 22, 1976. We granted the commission's application for direct appellate review.

The facts found by the motion judge are these. On February 21, 1977, the commission voted to investigate the administration of redevelopment programs under G. L. c. 121A by the Boston Redevelopment Authority (BRA) and the city of Boston. A subpoena was issued on March 1, 1979, to the Department of Revenue (department) to produce form 121A, Urban Redevelopment Excise Returns, and all attachments as submitted by six named corporations [Note 2] for the calendar years 1973 through 1978. On the same day the commission subpoenaed the commissioner of the assessing department of the city of Boston (assessor) and the BRA for "[a]ll financial records and statements" submitted by the six companies yearly for the same years pursuant to G. L. c. 121A.

In response to the subpoenas the department submitted one excise return for the year 1977 but declined to produce the other requested documents. The assessor and the BRA produced no subpoenaed items. [Note 3] The commission commenced this action, and The Prudential Insurance Company of America (Prudential) was allowed to intervene as the

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representative of the companies. The commission filed a motion to compel production of documents and for judgment. [Note 4]

The judge concluded that c. 121A projects are properly subject to the commission's investigatory authority under St. 1909, c. 486, Section 18, but that the law in effect before March 22, 1976, barred disclosure of "tax returns" by the subpoenaed agencies. On the basis of the parties' memoranda and the commission's uncontroverted, verified complaint, the judge ordered that discovery was limited to documents pertaining to c. 121A projects, the applications for which were filed on or after March 22, 1976. [Note 5] We agree.

The commission argues that it is entitled to discovery of c. 121A excise returns and records for all the years in question on two premises: first, that the documents are public records in which c. 121A corporations have a diminished privacy interest; second, that it has the statutory power and duty to reach the documents. The responding agencies maintain that the proscription against disclosure found in G. L. c. 62C, Section 21 (a), [Note 6] preempts the commission's public record claim and forecloses the need for balancing the privacy-publicity interests. We agree, in so far as the subpoenas encompass excise returns and their attachments.

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1. The Public Record Claim.

In 1975 the Legislature designated c. 121A information as public records. Statute 1975, c. 827, Section 7, replaced former Section 10 of G. L. c. 121A and added the proviso that: "All such information, as submitted to the tax commission, the department of corporations and taxation, and the appellate tax board by such corporation and the assessors of every such city or town, shall be filed with the housing board and in the office of the assessor of the city or town in which the project is located, and, upon request, shall be made available by said department of corporations and taxation and by the housing board to any person in accordance with the twenty-sixth clause of section four of chapter seven" (error in official print). The judge concluded that the above enactment rendered c. 121A records disclosable under G. L. c. 66, Section 10, but only as to c. 121A applications submitted for approval after the effective date of the 1975 amendment. [Note 7] The commission takes issue with the judge's prospective reading of the 1975 amendment and contends that G. L. c. 66, Section 10, mandates disclosure of all records filed in the years 1973 through 1978 because the documents it seeks were at all times, after 1973, public records within the intendment of G. L. c. 4, Section 7, as appearing in St. 1973, c. 1050, Section 6. [Note 8]

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The commission's reliance on our analysis of the public records statutes in Hastings & Sons Publishing Co. v. City Treasurer of Lynn, 374 Mass. 812 (1978), is misplaced in this instance. In Hastings we determined that the expansive definition of public records implemented by St. 1973, c. 1050, Section 6, set out at note 8, supra, required disclosure unless one of nine statutory exemptions applied. 374 Mass. at 817. The commission here seeks tax records which are "specifically or by necessary implication exempted from disclosure by statute." G. L. c. 4, Section 7, Twenty-sixth (a). General Laws c. 62C, Section 21 (a), explicitly provides for the confidentiality of tax returns. The records sought in this case thus fall squarely within exemption (a), G. L. c. 4, Section 7, Twenty-sixth, rather than exemption (c), [Note 9] the privacy exclusion addressed in Hastings. Cf. Attorney Gen. v. Collector of Lynn, 377 Mass. 151, 153-156 (1979).

Even conceding the public purpose of the c. 121A corporation and that such a corporation has a lesser privacy interest, as the commission claims, the question of the corporation's rights to confidentiality is not before us. [Note 10] The subpoenas at

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issue were directed, not to the six companies, but to public officials whose handling of tax records is the object of G. L. c. 62C, Section 21 (a). Only by reading a retroactive effect into St. 1975, c. 827, Section 7, [Note 11] could we reach the conclusion the commission urges. The commission, however, points to no legislative history that might overcome the clearly prospective intent of the section, and we thus rely on the plain language of the statute as enacted. County Comm'rs of Norfolk County v. Norfolk County Retirement Sys., 377 Mass. 696, 701 (1979) (only positive demonstration of contrary legislative purpose can overcome plain text). We concur in the judge's limiting discovery to the period after the effective date of St. 1975, c. 827. [Note 12] General Laws c. 121A, Section 10, as in effect during the pre-1976 time frame, extended without qualification the provisions and protections of G. L. c. 62C, to c. 121A excise returns.

2. The Applicability of G. L. c. 62C, Section 21 (a).

General Laws c. 63, Section 71A, was repealed by St. 1976, c. 415, Section 102, and replaced by G. L. c. 62C, Section 21, inserted by St. 1976, c. 415, Section 22. [Note 13] The provisions of both statutes serve the same underlying intent, to preserve the confidentiality of State tax returns in the hands of public officials. Leave v. Boston Elevated Ry., 306 Mass. 391, 402-403 (1940) (ban on disclosure by public officials cannot be circumvented by recourse to taxpayer himself); James Millar Co. v. Commonwealth, 251 Mass. 457, 464 (1925) (corporate excise returns are privileged).

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Section 21 (a) prohibits disclosure of information contained in a "return or document filed with the commissioner" held by the Commissioner of Revenue, G. L. c. 62C, Section 1, as amended through St. 1978, c. 514, Section 111, or any "employee of the Commonwealth or of any city or town . . . ." The section also contains an exception for "proceedings to determine or collect the tax." G. L. c. 62C, Section 21 (a). We examine each aspect of the statute -- the subject parties, the protectible materials, and the exception -- in light of the exemption under G. L. c. 4, Section 7, Twenty-sixth (a).

a. The Parties and Materials Subject to Discovery.

The language of the commission's subpoena to the department for "excise" returns clearly falls within the proscription of G. L. c. 62C. The subpoenas upon the two city agencies, by contrast, do not specify excise returns but call instead for "financial records and statements, submitted yearly ... pursuant to G. L. Chapter 121A . . . ." Here, the effect of Section 21 (a) depends on whether the assessor and the BRA are "employee[s] . . . of any city" and whether the records sought, if not "return[s]" are "document[s] filed with the commissioner" under that section. As to the assessor, the statute's prohibition is explicit; and, by operation of G. L. c. 121A, Section 10, the assessor has such an integral role in determining the excise [Note 14] that its c. 121A records are readily

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construed to be "document[s] filed with the commissioner" under Section 21 (a). As to the BRA, our reading of its enabling legislation, St. 1960, c. 652, Section 12, indicates "employee" status within the intendment of G. L. c. 62C, Section 21 (a). However, it is unclear from the record before us that the BRA holds tax "return[s] or document[s] filed with the commissioner" as does the assessor. [Note 15] The BRA has made no response here or in the court below. On the record before us, however, we conclude that to the extent the BRA possesses records predating March, 1976, and duplicating the contents of documents filed with the Commissioner of Revenue, such records are protected from discovery.

b. The Exception Clause in Section 21 (a).

We reject the commission's characterization that its investigation is a proceeding "to determine a tax," exempt from confidentiality under G. L. c. 62C, Section 21 (a). Without question, the enabling acts which gave birth to the Finance Commission of Boston also granted broad investigatory powers, including "matters pertaining to taxation." St. 1908, c. 562, Section 1. See St. 1909, c. 486, Sections 18 and 19; Finance Comm'n of Boston v. Basile, 354 Mass. 188, 191 (1968) (1909 organic act incorporated powers and duties enumerated in 1908 act). But no statute empowers the commission to determine or collect a tax. Contrast G. L. c. 59, Section 21, as appearing in St. 1971, c. 766, Section 19 (assessors empowered to fix the rate of tax); G. L. c. 60, Section 2, as amended by St. 1976, c. 4, Section 31 (constables and sheriffs named as collectors of taxes). The commission suggests no judicial opinion upholding disclosure on the basis of this clause. Opinion

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of the Justices, 354 Mass. 804 (1968), which the commission cites, addressed the rights of the Attorney General to obtain tax records "for the purpose of criminal prosecution." This purpose is manifestly different from the purely investigatory function of the commission and that opinion lends no support to the commission's claim. See Finance Comm'n of Boston v. Mayor of Boston, 370 Mass. 693, 696-697 (1976) (commission's function purely investigative).

Moreover, as we read the language of the predecessor statute, in effect during the years in question, we find no exemption for proceedings to "determine" a tax. [Note 16] G. L. c. 63, Section 71A, as amended through St. 1975, c. 514, Section 2. The difference in the language of G. L. c. 62C, Section 21 (a), and the prior version at G. L. c. 63, Section 71A, reinforces our conclusion that the commission's function is not so allied with the taxing power as to entitle it to disclosure. As we have already stated, both the present version, G. L. c. 62C, Section 21 (a), and its predecessor statute embody the policy of the Commonwealth to preserve the confidentiality of State tax returns. See Finance Comm'n of Boston v. McGrath, 343 Mass. 754, 766-767 (1962) (by statute, Massachusetts tax returns privileged; but Federal returns discoverable upon showing substantial necessity); see generally W.B. Leach & P.J. Liacos, Massachusetts Evidence 147-148 (4th ed. 1967). Until the Legislature took affirmative steps to modify that policy for c. 121A corporations, St. 1975, c. 827, Section 7, there was no reason to draw an exception to it.

Finally, the commission's citations to the statutory and judicial underpinnings of its authority fail to overcome the unequivocal prohibition upon the authorities named in

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G. L. c. 63, Section 71A (now G. L. c. 62C, Section 21). Without undercutting the established discovery and investigative powers of the commission, we conclude that its subpoena power must yield to the statutory confidentiality mandate which obtained prior to March, 1976.

Judgment affirmed