MAINE	SUPREME	JUDICIAL	COURT Reporter	of	Decisions Decision: 2017 ME 119 Docket: Ken

- 16

- 358 Argued: May	12,	2017 Decided: June	15,	2017
Panel: SAUFLEY,	C.J.,	and	ALEXANDER , MEAD, GORMAN , JABAR , HJELM, and HUMPHREY, JJ.

STATE TAX	ASSESSOR

v. MCI	COMMUNICATIONS	SERVICES,	INC.

GORMAN ,	J. [¶1] The	 State	 Tax	 Assessor	 appeals	 from the entry	 of a summary judgment	in the	Superior	Court	(Kennebec	County, Marden,	J. ) in	favor	of	MCI Communications	 Services,	 Inc.	 (MCI)	 on	 a n	 appeal by	 the	 Assessor of	 a decision	 vacating the	imposition	 of the state service	 provider	 tax	 on	 certain charges	collected	by	MCI

. The	court	concluded	that those	charges	were	part	of
the	sale	 of	interstate	 or	int ernational	 telecommunications	services	and	were therefore	excluded	or	exempt	from	tax ation

. We	affirm	the	judgment.
I.		BACKGROUND [¶2 ] This	 appeal	 concerns	 two	 types	 of	 surcharges

— property	 tax recovery	 charges (PTRCs) and carrier	 cost	 recovery	 charges (CCRCs)

— that MCI,	a telecommunications	service	provider of long distance	telephone	service2 in	Maine ,	imposed	 upon	its	Maine	 customers	in	 2008,	 2009,	 and	 2010. The

case was	 presented	 to	 the	 Superior	 Court	 through	 joint	 stipulations	 of	 facts and	 stipulated exhibits

. As	 stipulated,	 the	 following	 facts	are	not	in	dispute. MCI	imposed PTRC s on	its	customers	to	recover a	percentage	of	the	local	and
state	taxes	that it paid on	real	and	tangible	personal	property	used	to	provide international,	 interstate,	 and	 i ntrastate	 telecommunications	 services. MCI imposed CCRC s on	its	customers	to	recover a	percentage	of	the	expenses	that
it paid to	 the Federal	 Communications	 Commission	 ( FCC ) and	 third	 party administrators	for	regulatory	fees

. 1 MCI	determine d the	rate	of the	PTRC	and CCRC	surcharges	by	comparing	the	total	expenses	to	be	recovered	to	the	total eligible	 revenue	 (i.e.,	 revenue	 from	 interstate	 and	 international
telecommunications	 services )	 against	 which	 the	 surcharges	 we re	 to	 be

re covered,	 with	 the	 intention	 o f	 recovering only a	 portion of	 the	 total expenses	 paid. MCI	 c ollected	 these	 c harges only from its	 customers	 with
international	and	interstate	services.

1 These	 fees	 included	 interstate	 service	 provider	 regulatory	 fees,	 international	 bearer	 circuit fees, submarine	 cable	 fees, earth	 station	 fees,	 Nort h	 American	 Numbering	 Plan fees,	 federal telecom munications	 relay	 service fees,	 and	 federal local	 number	 portability fees. CCRCs	 also allowed	MCI	 to	 recover	part	 of	its	 own	 overhead	expenses	 related	 to	international and	interstate settlement	 recoveries , and	 collecting	 and	 administering	 CCRCs	 and	 the	 federal universal service fund.3 [¶3 ] In	January	of	2011,	Maine	Revenue	Services	(MRS)	notified	MCI of its	intent	to	audit	MCI	for	the	period	of	March	1,	2008,	to	December	31,	2010. As	a	result	of	the	audit, MRS	determined	that PTRCs	and	CCRCs were	subject

to taxation

. MRS assessed	 MCI $184,873.69,	 including	 interest, for	 those charges	collected	during	the	audit	period. [¶4 ] MCI	 sought	 reconsideration of	 the	 assessment , see 36	 M.R.S. § 151 (2012 ) , 2 which the	MRS	Audit	Division denied

. MCI next sought	review of	 the	 assessment	 with	 the	 Maine	 Board	 of	 Tax	 Appeals. See 36	 M.R.S. § § 151 (2) (E)

- (G) ;	36	M.R.S.	§ 151

- D	(2012 ). 3 By	decision	dated September 12, 2013,	the	Board	vacated	the	imposition	of	the	tax based	on	its	determination
that PTRCs	and	CCRCs	were excluded	or	exempt	 from taxation because	 they were	 charged	 only	 in	 connection	 with	 sales	 of	 international and	 interstate
services. [¶5 ] O n	 November	 6,	 2013 ,	 t he	 Assessor	 filed	 a	 timely	 petition	 for
review and	 de	 novo	 determination in	 the	 Superior	 Court. S ee 36 M.R.S.

2 This	 statute	 has	 since	 been	amended	 but	 not	in	any	way	 that	affects	 this	appeal.	 	 P.L.	 2013, ch. 45,	§	4	(effective	Apr.	22,	2013)	(codified	at 36	M.R.S.	§	151	(2016) ).

3 This	 statute	 has	 since	 been	amended	 but	 not	in	any	way	 that	affects	 this	appeal.	 	 P.L.	 2013, ch. 331,	§§ B

- 1 ,	B

- 2	(effective	Oct.	9,	2013)	(codified	at	36	M.R.S.	§	151

- D	(2016)).4 § 151

- D(10)(I) (2016)

. 4 A s	mentioned	above,	a fter	they	conducted	discovery, the	 parties	 entered	 a	 joint	 stipulation	 of	 facts	 and	 exhibits and	 filed

cross - motions	for	summary	judgment

. In	a	judgment	dated	June	30,	2016,	the court	denied	the	Assessor’s	motion	and	grante d	MCI’s	motion	for a summary judgment

. The	Assessor	timely	appealed.
II.		DISCUSSION [¶6 ] The	Assessor contends that the PTRCs	and	CCRCs collected	by	MCI were	subject	to taxation because	they	were	part	of	the taxable “sale	price”	of
telecommunications	services and	were	not excluded	or	exempt	from tax ation
because they	 were	 not	 themselves “telecommunications	 services” nor	 were they	international	or	interstate	in	nature. Because	the	Assessor	appeals	from
the	 court’s	 dec ision	 on	 cross

- motions	 for	 summary	 judgment, “ w e review
de novo	whether	there	was	no	genuine	issue	of	material	fact	and	either	party was	entitled	 to	judgment	as	a	matter	of	law.” BCN	Telecom,	 Inc.	v.	State	Tax
Assessor ,	2016	ME	165,	¶	2,	151 A.3d	497 ; see M.R.	Civ.	P.	56(c).

4 Although	the	Superior	Court	designated	this	case	as	an	appeal	brought	pur suant	to	M.R.	Civ.	P. 80C,	 the	 Superior	 Court	 considers	 de	 novo	 those	 petitions	 seeking	 review	 of	 a	 decision	 of	 the Assessor	pursuant	to	36	M.R.S.	§	151(2)(F)(2),	as	well	as	those	seeking	review	of	a	decision	of	the Maine	Board	of	Tax	Appeals	pursuant	to	3 6	M.R.S.	§	151

- D(10)(I).		We	therefore	review	directly	the decision	 of	 the	 Superior	 Court. See Linnehan	 Leasing	 v.	 State	 Tax	 Assessor ,	 2006	 ME	 33,	 ¶ 16, 898 A.2d	408; Apex	Custom	Lease	Corp.	v.	State	Tax	Assessor ,	677	A.2d	530,	532	(Me.	1996).5 [¶7 ] In	interpreting	a	 tax	statute, we look first	 to	its	plain	meaning	 to give	 effect	 to	 the	 Legislature’s	 intent. BCN	 Telecom ,	 2016	 ME	 165,	 ¶ 2,
151 A.3d	497. We	“seek to	avoid	absurd,	illogical	or	inconsistent	results”	and
“wil l	not	read	additional	language	into	a	statute”	or	treat	words	in	a	statute	as “meaningless	 and	 superfluous.” Blue	 Yonder,	 LLC	 v.	 State	 Tax	 Assessor , 2011 ME	 49,	 ¶ 10,	 17	 A.3d	 667 (quotation	 marks	 omitted). Further,	 w e
construe a	 tax	 statute “ most	 strongl y	 against	 the	 government	 and	 in	 the [taxpayer’s]	 favor ” and will	not	extend its reach “ beyond	 the	clear	import	 of the	 language	 used.” BCN	 Telecom ,	 2016	 ME	 165,	 ¶ 1 0,	 151 A.3d	 497 (quotations	 marks	 omitted) .	 	 S tatutory	 exemptions	 to	 taxes are	 construed

nar rowly,	however,	and we will	not	“extend[]	[ an exemption]

.	.	. to	situations not	 clearly	 coming	 within	 the	 scope	 of	 the	 exemption	 provisions.” Id. ¶	 13 (quot ation	marks	omitted).
A. The	“Sale	Price”	of	Telecommunications	Services [¶8 ] We	must	first determine	w hether	the	charges at	issue we re	part	of the	 “sale	price”	of	 telecommunications	services and	we re	 thus	subject	 to the service	provider	tax before turning	to	whether	the	charges	we re	excluded	or exempt	 from	 th at	 tax

. T he tax applied	 to	 “the	 valu e	 of	 .	 .	 . [ t ] elecommunications	 services,” and	 that	 value was	 “measured	 by	 the	 sale6 price.” 36 M.R.S.	 § § 2552 (1)(E),	 (2) (2016)

. 5 “Sale	 price”	 was	 defined ,	 in relevant	part, as	“ the total	amount	of	consideration

.	.	. for	which	.	.	.	services
are	sold .” 36	M. R.S.	§	2551(15) (2016)

. 6 A charge	falls	within	the	“sale	price”
if it is	“ part	of	the	total	compensation	paid	 for	telecommunications	services.”
BCN	Telecom ,	2016	ME	165,	¶ 12,	151 A.3d	497. [¶9 ] Like	 the	 charges	 at	issue	in BCN	 Telecom , PTRCs	 and CCRCs are part	of	“ the	total	amount	of	consideration	.	.	.	for	which	.	.	.	services	are	sold.”
36 M.R.S.	 § 2551(15) ; see generally 2016 ME	 165, 151 A.3d	 497 .	 	 N othing	 in the	 stipulated	 facts	 or	 exhibits

— which	 describe these	 charges as “surcharge[s]	 .	 .	 . calculated	 as	 a	 percentage	 of	 charges	 for

.	 .	 . telecommunications	 services” that “appear[ed]	 on	 a	 customer’s	 bill	 if	 the customer	 purchase[d]	 interstate	 or	 international	 telecommunications
service”

— distinguishes PTRCs	 and CCRCs	 “as	 anything	 other	 than [ charge s]
for	telecommunications	services.” BCN	Telecom ,	2016	ME	165,	¶ 12,	151 A.3d
497

. Based	on	the	plain	language	of	the	statute	and	“the	clear	import ”	of	that

5 Title	 36 M.R.S.	 § 2552 has	 been	 amended	 multiple	 times since	 the	 beginning	 of	 the	 audit period , but none	 of	 these	 amendments affects the	 statutory	 language	 at	 issue	 in this	 appeal. See, e.g. ,	P.L.	2015,	ch.	300,	§ A

- 32	(effective	Oct.	15,	2015)	(codified	at	36 M.R.S.	§	2552	(2016))

.
6 Although	 this	 statute	 was	 amended	 partway	 through	 the	 audit	 period, see	 infra Part	 B,	 the amendment	did	not	affect	the	relevant	portions	of	this	definition for	purposes	of	this	appeal

. This statute	has also been	amended	multiple times since	the	audit	period , but none	of	these	amendments affects	this	appeal. S ee,	e.g. ,	P.L.	2015,	ch.	300,	§§ A

- 30, A

- 31	(effective	Oct.	15,	2015).7 language, id. ¶	10, the PTRCs	and	CCRCs collected by	MCI were therefore part of	the	“sale	p rice”	of	telecommunications	s ervices	and	were	subject	to	taxation
unless they	were	otherwise	excluded	or	exempted	by	the	statute.
B. The	Nature	of	PTRCs	and	CCRCs [¶1 0 ] The	 Legislature	 amended	 the tax statute	 at	issue	in	 the	instant case	 partway	 through the	 audit	 pe riod.	 	 P.L.	 2007,	 ch.	 627,	 §§ 62

- 64 ,	 74

- 75 (effective	July	18,	2008)	(codified	at	36	M .R.S.	§§	2551,	2557	(2016 )). Before July	 18,	 2008,	 the	 statute excluded the	 “sale price”	 of	 international	 and
interstate	 telecommunications	 services	 from	 tax ation, see	 infra Part	 C,	 and, from	that	date	forward,	the	statute exempted the	“sale s of”	international	and interstate	 telecommunications	 services	 from	 taxation, see	 infra Part	 D.
R egardless of	 which	 version	 of	 the	 statute was	in	 force , whether the PTRCs
and	CCRCs were	subject	to taxation depends	upon	whether they related only
to	the	sale	of	international	and	interstate	services or	whether	they	were	also charged	in	connection	with	intrastate	services. [¶1 1 ] There	is	no	dispute	that MCI imposed PTRCs	and	C CRCs	only on
customers	w ho	 received intern ational	and	interstate	 services and	 calculated them	as	a	percentage	of the international	and	interstate	charges incurred	by8 those	customers

. 7 Despite those	uncontroverted	facts ,	however,	the	Assessor
pres en ts two	arguments	to	support	its	position on	appeal .		First, the	Assessor

assert s that ,	because	the	surcharges	themselves	were	not	“services”	and were not	 “interstate	 or	 international	 in	 nature,”	 they	 are	 neither	 excluded	 nor exempt	 from the service	 provider tax

. Second, the	 Assessor asserts	 tha t,
because	 PTRCs	 and	 CCRCs we re intended	 to	 recover	 costs	 that we re	 not exclusively	 incurred	 in	 Maine, they	 did	 not	 arise	 solely	 from	 the	 sale	 of interstate	 or	 international	 telecommunications	 services	 in	 Maine,	 and
th erefore they	are	not	excluded	or	exempt. We	do	not	 find	either	argument persuasive.
C

. Exclusion	of International and	Interstate Services [¶1 2 ] Before July	18,	2008,	the	statute	excluded	“service	originating	or terminating	outside	of	this	State”	from	the	definition	of	“ [ t ] elecommunications services,”	 thereby	 excluding	 the	 “sale	 price”	 of	 international and	 interstate
services	 from taxation .	 	 36 M.R.S.	 § § 2551 (15), (20)(B) (1) (2007); 36 M.R.S. §§ 2552(1)(E),	(2) (2007). Construing	the	statute	strongly	in	favor	of	MCI	and against	 the	 State, see BCN	 Telecom ,	 2016	 ME	 165,	 ¶ 10,	 151 A.3d	 497, we

7 As	the	Assessor	has	conceded,	MCI	imposed	the	charges	at	issue	only	on	the	international	and interstate	 portion	 of	 the	 customer’s	 plan	 even	 where	 a	 customer	 purchased	 bundled	 intrastate, interstate,	and	international	services.9 conclude	 that the	 PTRCs	 and	 CCRCs	 collected by	 MCI before July	 18,	 2008, were	not	subject	to taxation .		The	plain	language	of	the	statute	applied	the tax to	the	“sale	price”	of	“ [ t ] he	provision	of	2

- way	interactive	communications	.	.	. originating	 and	 terminating”	 within	 Maine.	 	 36 M.R.S.	 §§ 2551 (15), (20);
36 M .R.S.	§§ 255 2 (1)(E),	(2)

. Because PTRCs	and	CCRCs	were only included	in the	 “sale	 price”	 of	 telecommunications	 services originatin g or terminating
outside	of	Maine during	the	au dit	period, see	supr a Part	B,	they	were	excluded
from	taxation.
D

. Exemption	of International and	Interstate Services [¶1 3 ] From	 July	 18,	 2008, to	 the	 end	 of	 the	 audit	 period , the	 statute
defined	 “ [ t ] elecommunications	 services”	 more	 generally	 as	 “the	 electronic transmission,	conveyance	or	routing	of

.	.	. information	or signals	to	a	point	or between	 or	 among	 points

. ” 36 M.R.S.	 §	 2551(20

- A)	 (2016). It expressly exempted ,	however, “[s]ales	of	internati onal	telecommunications	service ”	and “[s]ales	 of interstate telecommunications	 service ” from	 taxation. 8 36	 M.R.S.

8 The	statute	defined	an	“ [ i ] nternational	telecommunications	service”	as	one	“that	originates	or terminates	 in	 the	 United	 States	 and	 terminates	 or	 originates	 outside	 the	 United	 States”	 and	 an

“ [ i ] nterstate	 telecommunications	 service”	 as	 one	 “that	 originates	 in	 one	 state,	 territory or possession	 of	 the	United	States	 and	 terminates	in	 a	 different	 state,	 territory	 or	 possession	 of	 the United	States.”		36	M.R.S.	§ § 2551(5

- A) , (5

- B) (2016 )

.10 § § 2557 (33), (34)	 (2015 )

. 9 T he	phrase	 “sales of ” is	undefined	in	 the	statute , and we	must	 determine whether	 the	 exemptions	 for	 “sales	 of” international
and	 interstate services	 i ncludes the	 statutorily

- defined “sale	 price , ” which would	 result	 in	 exempting PTRCS	 and	 CCRCs from taxation , or	 whether	 the exemption s a re mo re	 limited	 than	 the	 “sale	 price , ” which	 would	 mean	 that
PTRCs	and	CCRCs remain within	the	ambit	of	the tax	statute

. [¶14] “ In	 construing	 a	 statutory	 term	 that	is	 undefined	in	 the	 statute itself,	our	primary	obligation	is	to	determine	its	plain	meaning.		We	often	rely on	 the	 definitions	 provided	 in	 dictionaries	 in	 making	 this	 determination.” Apex	 Custom	 Lease	 Corp.	v.	State	Tax	Assessor ,	 677 A.2d 530,	 533	 (Me.	 1996) (citation	 omitted)

. Th e	 noun	 “sale”	 is	 commonly	 defined	 to	 mean “[t]he transfer	 of	 property or	 title for	 a	 price

. ” 10 B lack’s	 Law	 Dictionary	 1337 (7th ed.	 1999)

. Similarly, the	 Legislature	 has	 defined	 “sale” elsewhere	 to

mean “any	 transfer,	 exchange	 or	 barter,	 in	 any	 manner	 or by	 any	 means whatsoever, for	 a	 consideration ,” 36	 M.R.S.	 § 1752(13)	 (2016) , and “the

9 The	 Legislature	 recently	 amended	 these	 sections,	 limiting	 the	 exemption	 of	 sales	 of internati onal	and	interstate	 telecommunications	services	 to	 those	services	sold	 “to	a	business	 for use	directly	in	that	business.”		P.L.	2015,	ch.	267,	§§ TTTT

- 4,	TTTT

- 5,	TTTT

- 9	(effective	Jan.	1,	2016) (codified	at	36	M.R.S.	§§ 2557(33),	(34)	(2016)).		These	chang es	do	not	affect	this	appeal.

10 “Price”	is commonly	defined	as	“[t]he	amount	of	money	or	other	consideration	asked	 for	or given	in	exchange	for	something	else;	the	cost	at	which	something	is	bought	or	sold.”		Black’s	Law Dictionary	1207	(7th	ed.	1999).11 passing	of	 title	 from	 the	seller	 to	 the	buyer for	a	price ,” 11	M. R.S.	§	2

- 106(1) (2016)

. Considerin g	 these	 definitions	 together, a “sale ”	is fundamentally an exchange	 of	 goods	 or	 services	 for	 a	 price	 or consideration and is	 therefore
broader	 than	 and	 incl usive	 of	 the	 price

. See Darling’s	 v.	 Ford	 Motor	 Co. , 1998 ME	232,	¶ 14,	719	A.2d	111 (“In	the	absence	of	evidence	to	the	contrary, we	conclude	that	the	Legislature	intended	the	generally	accepted	mean ings	of the	terms	to	apply.”). [¶1 5 ] Based	on	the	plain	language	of	the	statute,	anything that	is	part	of the	“sale	price”	of	internationa l	or	interstate	services	is	also	part	of	the	“sale s of”	 those	 services ,	 which	 the	 Legislature	 exempted	 from taxation

. 11 PTRCs
and	CCR Cs,	as	part	 of	 the consideration	paid	 f or international	and	interstate telecommunications	 services, we re	 also	 part	 of	 the	 “ sales	 of”	 those	 services and	 “clearly	 [came]	 within	 the	 scope	 of	 the	 exemption	 provisions

. ” 12 BCN
Telecom ,	2016	ME	165,	¶	13,	151 A.3d	497 (quotation	marks	omitted)

.

11 Assigning	 the	 undefined	 term	 “sale”	its	 common,	 broad	meaning	is	also	 consistent	with	 the Legislature’s	definition	of	“sale	price”	as	“the	total	amount	of	consideration	.	.	.	for	which

.	.	. services are	sold [and]	any	consideration	for	services	that	are a part	of	a	sale .”		36	M.R.S.	§	2551(15) (2016) (emphasis	added). That	definition narrows	what	might otherwise	be considered	the	“sale	price”	by deducting certain	 listed	 amounts from	 the	 total	 consideration	 paid ,	 further	 suggesting	 that	 the “sale[]	of”	ser vices	is	broader	than	the “ sale	price” of those	services. See 36	M.R.S.	§ 2551(15)

.
12 Although,	 as	 the	 Assessor	 points	 out,	 PTRCs	 and	 CCRCs do	 not	 meet	 the	 definition	 of international	 or	interstate	 telecommunications	services because	 they	are	not	literally	 signals that originate	or	 terminate	outside	of	 this	State ,	 the	statutory	exemptions	apply	 to	 the	“sales	of”	 those services, which	 includes the “sale price .” To	 read	 the	 exemptions	 as	 applying	 only	 to “telecommunications	 ser vices”	 while	 ignoring	 the	 phrase	 “sales	 of”	 would	 violate our rules	 of12 [¶1 6 ] Accordingly,	we	conclude	that the	PTRCs	and	CCRCs	collected	by
MCI before July	18, 2008, were	excluded	from	taxation	and	that	those	charges collected	by	MCI	from	July 18,	2008 ,	forward were	exempt from	taxation. MCI was	 entitled	 to	 judgment	 as	 a	 matter	 of	 law. See M.R.	 Civ.	 P.	 56(c) ; BCN Telecom,	Inc. ,	2016	ME	165,	¶	2,	151 A.3d	497

. The	entry	is: Judgment	affirmed.

Janet	T.	Mills,	Attorney	General,	and	Kimberly	L.	Patwardhan,	Asst.	Atty.	Ge n. (orally) ,	 Office	 of	 the	 Attorney	 General,	 Augusta,	 for	 appellant	 State	 Tax Assessor Jonathan	 M.	 Dunitz,	 Esq.,	 Verrill	 Dana	 LLP,	 Portland , and	 Cindy	 B.	 Gonzales, Esq. (oral ly) ,	Verizon	Corp.	Resources	Group,	LLC,	 Irving,	Texas,	 for	appellee MCI	Communications	Services,	In c.

Kennebec	County	Superior	Court	docket	number	AP

- 2013

- 42 F OR C LERK R EFERENCE O NLY

statutory	construction. See Blue	Yonder,	LLC	v.	State	Tax	Assessor ,	2011 ME	49,	¶ 10,	17	A.3d	667 ( explaining that we must not	treat	words	in	a	statute	as	meaningless	or	superfluous).