Sunday, August 19, 2007

Marion County's $2.7 Billion Tax-Exempt Problem

The Star's Robert King and Mark Nichols have a good story which draws attention to the problems created by having so much tax-exempt property in Marion County. "All told, Marion County exempts more than $2.7 billion worth of property," they write. "And that doesn't include Marion County's many government buildings, which are exempt, and breaks offered to prospective new businesses." Discussion of taxing or imposing fees on the tax-exempt property is gaining some traction according to the report. "As homeowners strain under the burden of property taxes, calls are rising here and across the country to reconsider the extent of tax exemptions, or at least charge fees for public services the nonprofit organizations receive." The story notes the value of tax-exempt property in Marion Co. has grown 23% in the past 5 years.

I think the idea of at least imposing some service fees on these tax-exempt properties is worthy of serious consideration, but as an account by Rep. Bill Crawford (D) notes, the politicians will have to tread lightly in this area. "Rep. Bill Crawford, D-Indianapolis, said he took hostile fire a few years back -- primarily from churches -- when he proposed that nonprofits pay a $100 annual service fee for police and fire protection." Of course, he is referring to the organized opposition Advance America's Eric Miller gathered to the proposal. You can bet Miller will be awakened again on this issue if it comes back to life.

12 comments:

Anonymous said...

Wow! The Star's online Data Base for nonprofit property values is extremely informative.

Gary,
Go to the Star's data base and check out the fraternal section on nonprofit property tax exemptions in Center Township.
Two in particular caught my eye:

1) The Brotherhood Athletic Education Association, Inc. (they are actually real estate developers)

2) Boner Properties LLC (also real estate developers)

If you have ever been in the Indianapolis Scottish Rite Cathedral you assume it's worth a more than it's appraised value. On the other hand, the Indiana Grand Masonic Lodge is valued substantially lower than the SR Cathedral.
Now go and check out how little the Murat Shrine property was valued at and they host plays and concerts.

The Boner and Brotherhood exemptions reek of politics. The Masonic Properties are way undervalued even if they did pay taxes.

This whole nonprofit thing really needs to be looked into.

Advance Indiana said...

Great discovery, anon 11:17. Do you think anyone in the mainstream media will follow up on it?

Anonymous said...

Great discovery, anon 11:17. Do you think anyone in the mainstream media will follow up on it?

Well, you know when they finally get around to it, it will be "first reported" in the mainstream media!!

Anonymous said...

He-heh, good one, 1:37.

Here is one theory: Republicans in the legislature might go along with introduction of proposals to allow service fees, or a small property taxz, on certian church-related properties.

They'd do it to enflame the religious right, and get them to the polls.

Kinda Rovian, but within the realm of possibility.

Anonymous said...

The Brotherhood Athletic Education Association's President is an individual named Dejuan Boyd. They are represented by none other than Ice Miller.
There was a court case a few years back when their exempt status was denied by the State and they apparently got it back via a civil rights lawsuit and another hearing before the State Tax Board.

How can BAEA and Boner both fall under the title of Fraternal when they are both in the real estate business. Remember that the Boner group recently revieved $10 million for sidewalks and curbs.

Anonymous said...

Gary,
What would you think of a church having a contract with the City of Indianapolis to mow City parks? My understanding is that this church has a spinoff 501C3 that contracts with the City to mow about 14 City parks.

Katz said...

Note that all the area union halls are exempt, too.

Anonymous said...

Well, you know when they finally get around to it, it will be "first reported" in the mainstream media!!

and "the Scribe" will cry about not getting credit!

Anonymous said...

Mayah Petuhsun doesn't seem to be drawing much attention to one of his other "well-managed" projects -- The Bart Mahal Library.

I wouldn't let Peterson or The Gray Mafia anywhere near my house to change a light bulb. Four things would certainly happen;

1. It would take two years before I had light in the basement,

2. It would cost me $50 a bulb contracted through a "Friend-o-Bart (or CCC member),

3. It would have to buy 100 light bulbs through the above agents,

4. My taxes would rise.

The taxpayers can't get this fool out of office soon enough.

Anonymous said...

Gary -- Did you notice that the ISTA building at Capitol and Market is tax exempt, too? I've been told that the entire building is exempt, even though only a small part is used by the ISTA and the rest is rented like any other private real estate. What a crime.

Advance Indiana said...

Anon 12:20, the leased space in the ISTA building should not be exempt from taxation unless the tenant is a tax-exempt organization. I'm not sure who all the tenants in that building are now, but I know it used to have a few for-profit businesses, as well as some NFPs.

ROACH said...

http://x-wire.blogspot.com/2007/08/how-to-decimate-property-tax-base-in.html