ROCKLAND, Maine — The owners of a historic inn are challenging the city’s tax policy as discriminatory.
Michael Laposta and Cheryl Michaelsen, owners and operators of the Berry Manor Inn, are asking the city to abate the $58,300 in personal property that it was taxed for in 2015-16 for furniture, appliances and fixtures. The couple argue that the city is not imposing the tax on personal property for nearly all the property owners who offer short-term vacation rentals on websites such as Airbnb and VRBO.
The Rockland Board of Assessment Review is scheduled to hear the appeal at 5:30 p.m. Wednesday at City Hall.
The Berry Manor Inn’s website states it is one of the premiere luxury Maine coast inns in the Rockland/Camden area. TripAdvisor called the Berry Manor Inn one of the 25 best bed-and-breakfast inns in the United States.
The couple submitted a letter to support their appeal that states there are 89 residential vacation units in Rockland, including the five licensed bed-and-breakfasts such as the Berry Manor Inn. The city, however, only taxes less than one in 10 of those units, and some are not being taxed for all furnishings.
The inn owners point out that both city ordinances and state law require that the operators of income generating businesses submit lists of non-real estate assets to the assessor, and that is to be taxed. But the city has chosen not to levy taxes on such short-term rentals that they know operate.
“This practice is an act of unjust discrimination against the Berry Manor Inn and other licensed residential licensed properties,” the inn owners stated.
The tax on the inn’s personal property amounts to $1,236.
The appeal to the board came after the request was denied at the assessor level.
The couple also are asking for an abatement on the historic Talbot Home, which they are converting to a bed-and-breakfast. The assessor has denied that request, but it has not yet been scheduled for the Board of Assessment Review.
Laposta and Michaelsen say during the past year, the 73 Talbot Ave. property has been a single-family residence and as such is dramatically overassessed by the city. The couple have asked the city to reduce the $577,600 assessment on the Talbot Home by $302,600. With the current tax rate, that would reduce the tax bill on the property by $6,415.
The couple purchased the 73 Talbot Ave. home in December 2014 for $255,000. The 12-room Victorian-style home had been a home for elderly residents for 51 years until it closed in July 2014.
Laposta and Michaelsen had originally planned to make the Talbot Home their residence but, having decided that its best use would be as a bed-and-breakfast, they applied for a permit to let out four rooms for overnight stays. Construction for the dining area of the Talbot Home is expected to be done by the end of the month, according to code enforcement records.
The abatement request, however, is for the past year when it was simply a single-family residence.
“We contend the subject property is a ‘white elephant.’ It is a unique property for which there is no other property in Rockland that compares or can be deemed ‘similar,’ as there is no other single family residential home with as much square footage, that is as old or is as limited in commercial use being in residential A zone,” the couple stated in their appeal to the board.
The home has 6,600 square feet of living space.
Laposta and Michaelsen said applying a per-square-foot value to a home to determine its taxable value does make sense at some point.
“As a 156-year-old historic structure located in a dense, residential neighborhood without water views, excessive land or privacy, there comes a point where excessive square footage is not as valuable in a residence,” they stated.