Massport's unfair share

TRAVELERS THROUGH the new Terminal A at Logan Airport will soon enjoy gourmet dining, a brew pub, a high-end art store, a deluxe electronics shop, and other fancy amenities — all on tax-exempt property owned by the Massachusetts Port Authority. That development isn’t going down well with the Menino administration, nor should it.

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Roughly 150 tax-exempt businesses already operate on Massport-owned land at the airport. The new $400 million, 560,000-square-foot terminal for Delta Air Lines will add 15 stores and 17 restaurants to the mix. And unlike their competitors downtown and in the city’s neighborhoods, the bars and boutiques at Terminal A will not need to factor commercial property taxes into the costs of doing business.

As he has done in the past, Mayor Menino is expected to denounce Massport’s eternal tax holiday today when he speaks to business leaders at the annual meeting of the Boston Municipal Research Bureau. But the message is more urgent now that the city’s tax burden is shifting from commercial to residential properties, largely due to higher residential values and flat growth on the commercial end. It’s a real political problem for the mayor when the traveler through Logan can look forward to a break on the price of his baguette while the owners of single-family homes pay average annual increases of roughly 13 percent over the past two years.

Massport pays about $11 million in lieu of taxes to the city each year. But the hotels, restaurants, and other airport-related businesses would pay closer to $20 million annually if assessed the way other business properties are, according to Boston’s assessor, Ronald Rakow. The tax-exempt status of the new businesses at Terminal A tips the scales in Massport’s direction by an additional $400,000, according to Rakow.

The Delta redevelopment of Terminal A created a significant number of construction and service jobs while advancing the goal of modernizing Logan Airport. But there is no sound reason why the for-profit businesses in Boston should remain exempt when the great majority of their counterparts in busy airport markets elsewhere pay taxes to local or state authorities.

Ideally, the Legislature should approve Boston’s efforts to collect commercial property taxes from both airport businesses and those operating on land owned by the MBTA. That would raise the business tax ceiling and reduce pressure on homeowners. Minimally, Massport should be prepared to offer higher payments in lieu of taxes when it renegotiates the current agreement, which expires in June.

Unstable tax breaks should no longer fly at Logan Airport.