Monday, January 26, 2009

Nebraska Supreme Court Reverses Denial of Property Tax Exemption to Church that Leased Property to Local School Board: Creighton University Law Student Argued Case

The Nebraska Supreme Court recently held (scroll down a bit to get to the opinion heading) that a Church that leased part of its property to a local school board deserved full (i.e., 100%) property tax exemption in that portion of its property leased to the school board for educational purposes.  This, despite the fact that the Church leased the property out at market rates."   Significantly, especially in light of the immediately previous post, the Court specifically rejected the argument that since the Church leased the property at market rates it was not entitled to property tax exemption.  A law student from Creighton University School of Law (scroll down to "points of Pride) successfully argued the case as part of Creighton's Community Economic Development Clinic.  You can hear the student's very superb argument here (scroll down to November 6 and click on the audio icon next to "Fort Calhoun Baptist Church v. Washington County Board of Equalization").  Its nice to learn things from students and though I don't know this student, I felt a sense of pride when listening to his argument.  It is even more fascinating to hear the interchange between the Supreme Court judges, the law student and opposing counsel regarding whether below market prices are necessary to achieve charitable, tax exempt status.  Needless to say, the opinion cuts against the argument I make in my immediately previous post.  I still say, though, that tax exempt status ought to be presumptively denied to organizations that do not inevitably or necessarily benefit the poor (e.g., through below market rates for their goods and services).

dkj

http://lawprofessors.typepad.com/nonprofit/2009/01/nebraska-suprem.html

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