OTOH, it's not really a new problem. 3E d20M solves it by drastically curtailing the ranges of all guns, which IIRC generated a bit of a ruckus at the time.
I dunno how far they actually "curtailed" them, if you look at the reality. Those ranges are actually range increments, so it's more about "effectiveness" and shot difficulty rather than pure maximum killing range, as many rifles have a killing range which is greater than the range with which it is possible to make what should be a center of body shot after controllable factors are accounted for ensure a kill due to simple spread. (In other words, the gun has a range after which the possible spread is larger than the actual target itself, so any shot taken, no matter how well-targeted, is unreliable and has a luck factor associated with hitting the target which cannot be controlled for.) The full range in d20 Modern, as I recall is 10x the range increment, so a rifle with a 100 m RI has a maximum in-game effective range of 1 km, but a range of 100 m with which it can be fired without penalty. That seems to jibe well with current reality; the bulk of long-range shots fired from rifles are well within 1 km, and the general maximum outside of special cases is supposedly around 900 m. Specialist target shooting rifles can get significantly better ranges, but they are typically not meant to be used in combat and are heavily modified so that it is better to approximate them via the gadget system and should be treated like the one-offs they are.
So in other words, the "without penalty" is probably the operative term here; if we keep the max ranges the same, it is mostly where the penalties are that matters. There are two main factors which should influence range penalties: the ability of melee characters to close on a target and the effective size of the arena. Smaller battles where melee is desired should are more likely if the rules tend towards smaller range increments with harsher range penalties, and larger battles where ranged is king are more likely if the reverse is true, assuming damage per round from each is approximately equal. This is ultimately a question of game style. I'd personally favor a more ranged-friendly style, as compared to say D&D, but that's just personal preference.
Either way, I agree with M_R: it's best handled as a hazard or a trap. If the players can't fire back, then there's no point to a sniper being statted as a "character", as there's nothing the PCs can do about it except keep out of the line of fire. So I don't mind short ranges, as long as it's made immediately clear that there's a difference between maximum effective range in combat and maximum effective range under optimal circumstances, and how to translate between them. (In essence, detailing the Range Increment system and how it works, and what factors mitigate those penalties, which Modern already does to a degree, though it's obviously not something a lot of people immediately "get.")
However, if the players can effectively do something about it, though it would make the "battlemat" unreasonably large, then it should be treated somewhat differently, but still, at heart it should be treated primarily as being a case of a certain area being under a hazard or trap condition which can be removed with an sufficiently damaging successful attack or series of attacks from a weapon. Certainly, that is a non-traditional method of disarming the trap, but it is one appropriate to the situation.
